LIBRARY OFCONGRESS. 

•to <?'ffW $» 



UNITED STATES OF AMERICA. 



4- 

ECONOMIC TRACTS. No. XX. 



LABOR DIFFERENCES AND 
THEIR SETTLEMENT 

A PLEA FOR ARBITRATION AND CONCILIATION 



JOSEPH I). WEEKS 



NEW YORK 

THE SOCIETY FOR POLITICAL EDUCATION 

31 PARK ROW 

1886 

*■* ! ft" 



The Society for Political Education. 

[ORGAXIZED 1880.) 

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J0O4 'w' /&££&€ te6u<&^ 



ECONOMIC TRACTS. No. XX. 



LABOR DIFFERENCES AND 
THEIR SETTLEMENT 

A PLEA FOR ARBITRA TION AND CONCILIA TION 



BY 



JOSEPH D* WEEKS 




NEW YORK 

THE SOCIETY FOR POLITICAL EDUCATION 

31 PARK ROW 

1886 



PREFATORY NOTE. 



The Society for Political Education includes in its regu- 
lar series of tracts papers which it believes to be useful 
to the people and in harmony with its general line of 
work, without committing itself to details of argument 
or of opinion which may represent the individual 
judgment of the special writer rather than the general 
judgment of the Committee of the Society. 



Copyright, 1886, by Joseph D. Weeks. 



PREFACE. 



The conclusions presented in the following pages are 
the results of more than fifteen years' close and careful 
study of the labor question in two hemispheres. During 
most of this time I have held such positions as compelled 
me to be not a looker-on, but an actual participant in 
some of the most important labor contests that have oc- 
curred in this country. I have twice visited Europe 
especially to investigate the subjects discussed, and have 
been honored with the friendship and confidence not only 
of many employers, but of the labor leaders of this coun- 
try and England. While I do not assume to speak for 
either employer or employed, it is believed that the views 
herein advanced, in their general scope, are in accord 
with those of the most liberal and far-seeing of both. 

It is evident to those who have been brought into actual 
contact with those questions that arise between employer 
and employed, that the present prevalent hap-hazard 
method of settling them is not only inefficient but dan- 
gerous, and the necessity for some method that shall sub- 
stitute reason for greed and force is both pressing and 
importunate. It is believed that under the present con- 
stitution of industrial society arbitration presents not only 
the best, but the only method that gives any promise of 
success. Whether such changes may not be made in the 
constitution of industrial society itself as to remove the 
cause of these differences it is not within the province of 
this discussion to enquire. 

Pittsburgh, Pa., Feb. i, 1886. 



CONTENTS 



fAGK 

I 



CHAPTER I. 

Differences between Employers and Employed 

CHAPTER II. 

Some considerations preliminary to the investigation 
of methods for settling Labor Differences 

CHAPTER III. 
Methods for settling Labor Differences. The 
Theory of Competition 

CHAPTER IV. 

Methods for settling Labor Differences — Continued. 
The Theory of Association .... 

CHAPTER V. 
Arbitration and Conciliation 

CHAPTER VI. 
Legal Arbitration and Conciliation .... 

CHAPTER VII. 
Voluntary Arbitration and Conciliation . 

CHAPTER VIII. 

Some examples of Voluntary Arbitration and 

Conciliation 59 

CHAPTER IX. 
Some objections to Arbitration . . . .70 



14 



27 



39 



46 



55 



LABOR DIFFERENCES AND THEIR 
SETTLEMENT. 



CHAPTER I. 

DIFFERENCES BETWEEN EMPLOYERS AND EMPLOYED. 

So long as the present organization of industrial society 
continues, differences between two of the great classes of 
which it is made up, employers and employed, will of 
necessity arise. While it is true that in many of the re- 
lations growing out of their association they have a com- 
mon weal, which in such relations permits of no antago- 
nism, it is equally true that in others their opinions and in- 
terests diverge, and differences result. These differences 
will at times grow into disputes, and may end in industrial 
strife, that is, in strikes and lockouts. 1 Such contests are 

1 Strikes and lockouts I have elsewhere defined as " suspensions of 
work growing out of differences between employer and employed." 
A strike is a suspension of work resulting from a dispute originating 
in some demand of the employed — a lockout, in some demand of the 
employer. A stoppage of work, for example, resulting from a demand 
on the part of the employes at a works for an advance in wages 
would be a strike ; a stoppage resulting from a demand by the em- 
ployer for a reduction would be a lockout. 

It is frequently difficult to determine whether a labor contest should 
be classified as a strike or a lockout. Practically the distinction is of 
little importance, except as it bears on the question of the relative 
tendency of employer and employed to take the initiative in these 
industrial conflicts. Unless, therefore, it is expressively stated to the 
contrary, the word strike in this discussion will include both strikes 
and lockouts. 



2 LABOR DIFFERENCES 

so fraught with disaster, so full of waste and misery, that, 
ever since labor became free and wages paid, there has 
been no small solicitude to discover some speedy and 
efficient way of harmonizing these differences and pre- 
venting them from growing into disputes, or of settling 
these disputes, if unfortunately they arise, without a mass- 
ing of forces and the shock and waste of conflict. 

The chief causes of these differences are questions as 
to rates of wages. It is here that the interests of employer 
and employed begin to diverge, and it is concerning these 
questions that differences most frequently result in labor 
contests. In an enquiry into the strikes and lockouts of 
1880 made by the writer for the Tenth Census, out of a 
total of 813 labor contests investigated, 582 or 71.59 per 
cent, were caused by differences as to rates of wages. 1 
Of these 582 contests, 86 per cent, were for advances in 
wages, and 14 per cent, against reductions. While these 
exact proportions will not hold in all years nor in all sec- 
tions and industries, it is true that by far the most prolific 
sources of labor disputes are differences as to wages. It 
will also be found upon investigation, that many disputes 
that are not primarily wages disputes, have a direct bear- 
ing on rates of wages, and are important only because 
of such bearing. 

1 The result of this investigation, so far as relates to cause, was as 
follows : 

Per cent. 
of each 
Causes. Number. to whole. 
Total 813 100.00 

Rates of wages ...... 582 7i«59 

Payment of wages 35 4.30 

Hours of Labor ...... 7 .86 

Administration and methods of work . . 107 13.17 

Trades-unionism 22 2.70 

Miscellaneous . . . . . . . 9 1.11 

Not given 51 6.27 



AND THEIR SETTLEMENT. 3 

Apart from rates of wages the causes of these differ- 
ences are legion. They may arise concerning the basis 
of computing wages ; the method, time, or frequency of 
payment ; apprenticeship ; hours of labor ; administra- 
tion and methods of work, such as shop rules, labor- 
saving machinery, piece-work, objectionable workmen, 
etc. ; trades-unions and their rules, and a thousand and 
one causes that need not be stated in detail. Nothwith- 
standing their number, however, it will be found that all 
causes of difference readily group themselves into three 
general classes : 1 

1 st. — Differences as to future contracts. 

2d. — Disagreements as to existing contracts. 

3d. — Quarrels on some matter of sentiment. 

In this classification the word " contracts " is to be 
regarded as including not only formal agreements, but 
those customs of the shop or trade, and those methods of 
work or of administration which, from long usage, have 
the force of contracts. In the first division would be 
classified differences as to future rates of wages, and 
those arising from attempts to change or abrogate exist- 
ing agreements, customs, or methods, or to introduce 
new ones. Disagreements under the second class arise 
either upon matters of fact or construction, having in 
view existing agreements, customs, or methods, and not 
necessarily involving the validity of the contracts them- 
selves, nor any change in their terms. Under the third 
class are included those quarrels that grow out of the 
offended amour propre either of the individual or the 
class. 

It is in the first of these classes — " Differences as to 
future contracts " — which, as stated, includes questions 
as to future rates of wages, that differences most fre- 

1 This is practically Sir Rupert Kettle's classification. 



4 LABOR DIFFERENCES 

quently occur, and in which there is the greatest difficulty 
in harmonizing conflicting interests and assimilating hos- 
tile views. What is " a fair day's wage for a fair day's 
work " is a most difficult and complex problem, and yet 
it is constantly recurring with ever-increasing frequency. 
Concerning its solution there are honest differences of 
opinion, not only in individual cases, but as to the basis, 
the principle upon which it shall be decided. Even 
when a decision has been reached it is not final and per- 
manent, for the conditions existing when it was framed 
are not themselves permanent. What may be fair and 
equitable to-day may be unfair and unjust to-morrow, 
when the conditions differ from those of to-day. So, 
with the ebb and flow of the tides of business, of prices 
and demand, so frequent in these days of the increased 
effectiveness of labor and rapid transportation ; with the 
changes in methods of production or conditions of work, 
and the introduction of methods entirely new, so common 
in this age of invention, comes an ever-recurring necessity 
for a revision of the contracts or agreements governing 
the relation of employer and employed, and with it the 
possibility of differences as to what changes the differing 
conditions demand. 

Disagreements of the second class relate to what is or 
has been, not to what shall be, and grow out of differences 
as to what really is the agreement or contract, or what is 
the custom of the trade — that is, as to matters of fact or 
of construction. The parties to a contract, if it is a 
verbal one, may honestly differ as to its terms ; or as to 
its construction, if it is a written one. It may be ambig- 
uous or doubtful ; craft or cupidity may have violated it 
in spirit or letter or both, or it may be transgressed inad- 
vertently. Labor may be performed under some condi- 
tions more onerous or more beneficial to one party or the 



AND THEIR SETTLEMENT. 5 

other than those the contract calls for, or under condi- 
tions not at all contemplated when the contract was made. 
There may be a doubt, honest or otherwise, as to just 
what the custom is under given conditions, but whatever 
form the question takes, it always refers to work per- 
formed or contracts that exist, though the decision 
may govern work to be done, possibly may re-frame the 
agreement. 

Quarrels growing out of what I have termed ''matters 
of sentiment " are happily less frequent than formerly. 
They may precipitate strikes, but labor contests now 
rarely result from these quarrels alone. Their chief 
cause is to be found in a failure to recognize fully that 
the relation of employer and employed is no longer that 
of master and servant. The employer curtly refuses to 
submit to what he terms interference or dictation, and the 
employe hotly and indignantly declines to recognize any 
Assumption of authority on the part of the employer, or 
to entertain an idea of inferiority on his own. The inter- 
ference or dictation may be only a plain, honest assertion 
by the employe of his own rights ; the act regarded as an 
assumption of authority an inadvertent one ; but with this 
old idea of the dominant and servient relation lingering, 
often unconsciously, in the minds and prejudices of both 
classes, and with a mutual distrust and suspicion, the in- 
heritance of centuries of conflict still remaining, individ- 
uals, and more especially masses, are extremely sensitive 
to any act or word that in appearance even seems to 
recognize the existence of the old relations. 

It will also be found that these " matters of sentiment," 
this offended self-respect of the parties to these differ- 
ences, often defer their settlement, and prolong contests 
when they arise. The question at issue, which at first 
may be a simple one, unless some mode of settlement be 



6 LABOR DIFFERENCES 

quickly discovered, becomes a complicated one. Ideas 
of fairness, generosity, justice, good faith, become in- 
volved, and the question assumes new phases, and pre- 
sents questions that are most difficult of solution. 



AND THEIR SETTLEMENT. 



CHAPTER II. 

SOME CONSIDERATIONS PRELIMINARY TO THE INVESTI- 
GATION OF METHODS FOR SETTLING LABOR 
DIFFERENCES. 

In seeking methods for the prevention or adjustment 
of labor differences, the results reached are often worth- 
less or of little value, because the search has proceeded 
upon assumptions that are erroneous, or that are based 
upon conditions that do not exist. There is also, on the 
other hand, a failure or refusal to recognize conditions 
that undoubtedly prevail, and causes which experience 
proves are potent within the field of industry. No 
method for harmonizing labor differences that ignores 
obvious facts, or that refuses to recognize forces which 
play an important part in determining and adjusting the 
relations of employer and employed, can be of any practi- 
cal value. Such methods, when tried, will either break 
down from lack of adaptability or from inherent inca- 
pacity, or if they act for a time, will fail when the strain 
for which they were not calculated is exerted. 

That notable changes have taken place, especially 
within the last twenty-five years, in the theories, the con- 
ditions, and the relations involved in discussions of labor 
differences and their settlement, cannot be questioned. 
The theory of the relation of employer and employed has 
been recast, and their attitude to each other, and of both to 
the state and to society, greatly altered. Even the indi- 
viduals of the class maintain quite different relations to each 



8 LABOR DIFFERENCES 

other, and to the industry as a whole in which they are en- 
gaged. Legislative restriction of labor has been abandoned 
entirely or greatly modified, the laws of conspiracy altered, 
trades-unions legalized, and the body of labor legislation, 
beginning with the Statute of Laborers, and covering a 
period of 650 years, which has been " the effort of a 
dominant body to keep down a lower class which had 
begun to show inconvenient aspirations," practically re- 
moved from the statute-book. The common-law doc- 
trine of non-restraint of trade and the theory of 
non-interference with the liberty of the subject have been 
greatly qualified by legislative enactments, such as the 
factory, truck, and employers'-liability acts; laissez faire 
has been degraded from an eternal and inflexible law to 
a simple rule of conduct that may change with circum- 
stances ; competition has been acknowledged to be 
imperfect ; combinations are multiplying ; the wage-fund 
theory has been exploded ; and the economic man dis- 
charged from his onerous duties, and one with " sym- 
pathies, apathies, and antipathies " employed in his stead. 
In the face of all these changes it needs no argument to 
show that the methods of thought and action that prevailed, 
and assumptions based on the conditions of years ago, 
are of little value now. He will most assuredly lose his 
way who attempts to direct his search for methods of ad- 
justing labor disputes by the political economy prevalent 
a generation since. 

On the other hand, he will commit as grievous an er- 
ror who fails to recognize the new conditions and to 
frankly accept the limitations and methods which they 
impose. As a result in part of these changes, as well as 
of the quicker and broader grasp of the age, the sources 
of discontent and the causes of difference have greatly 
multiplied, The problem is assuming greater complexity 



AND THEIR SETTLEMENT. 9 

with every year. As has been pointed out, rates of wages 
are not now the only subjects at issue. Questions which, 
under the views held or the conditions that obtained a 
generation ago, could not possibly have arisen to disturb 
the relations of employer and employed, are now of every- 
day occurrence. Production is carried on under differ- 
ent conditions, the rewards of labor are calculated on a 
different basis, and labor itself holds different relations to 
production and to the other members of industrial society. 

In these changes, as was to have been expected from 
the fact that it was not its interests which had been con- 
sulted in determining previous conditions, and in the 
adoption of old methods, labor has profited the most. 
With its growing power and intelligence, with its larger 
liberty and freedom of action and combination, with the 
removal of the legislative burdens under which it stag- 
gered and the imposing for its benefit of other — not on 
labor itself directly, but on industry, — and with the aban- 
donment of certain economical theories that rested upon 
it like a horrible nightmare — illusory, but as dire and dis- 
tressing as though real, — labor has come into possession 
of a new and larger life. The old methods of dealing 
with the questions that affect its interests and relations, 
or methods that are based upon the old conditions and old 
views, are no longer effective, nor will they be longer toler- 
ated. No more serious error can be committed in seeking 
and applying methods for the prevention or adjustment of 
labor differences than a refusal or failure to recognize, 
with all it involves, the new relations of labor and the 
drift of thought and action among working people. 
Such an error is fundamental and vital, and, so long as 
it remains uncorrected, industrial peace is impossible. 

And yet, through the force of old habits of thought 
and old methods of action, even among those who ordi- 



IO LABOR DIFFERENCES 

narily desire such peace, there is a neglect or failure to 
recognize the new conditions, and to frankly accept the 
limitations and methods which they impose. 

The source of this error is chiefly in the idea, inherited 
from feudal days and justified by much of the legislation 
and political economy of modern times, that the em- 
ploye] is the superior, the employe an inferior ; that it 
is the right of the former to determine, the duty of the 
latter to acquiesce. This view does not often express 
itself bluntly in words, but it does more or less uncon- 
sciously in acts. The employer assumes the sole right 
to determine, and refuses to discuss questions that arise 
in connection with wages or the details of employment, 
in the decision of which the employe has an interest 
equally with the employer, or, if such discussions take 
place, they are "permitted" ; an interview is "granted." 
In case of a meeting, the employer assumes the right to 
dictate its method. " No committee will be recognized." 
The employer also claims the right, in many cases, to 
determine the relation an employe shall hold to his fel- 
lows, and prohibits his membership in a union. In all of 
these, and in many similar cases, there is an assumed 
superiority of condition which does not exist in reality, 
however much it may be asserted by word or act. The 
true relation of employer and employed is that of inde- 
pendent equals, uniting their efforts to a given end, each 
with the power, within certain limits, to determine his 
own rights, but not to prescribe the duties of the other. 
The employer has no more right to dictate or even decide 
how labor shall seek its interests than labor has to dic- 
tate to the employer. Whatever may be the views of 
the latter as to trades-unionism, it will be well, in most 
cases, especially in great centres of industry or in those 
employments uniting great bodies of men under one 



AND THEIR SETTLEMENT. II 

management, if, with the best grace possible, he accept 
the fact of combination and deal with its representatives. 
Such combinations, with all their faults and follies, are 
not entirely bad. 

It is possible that this assumed superiority grows out of 
a false idea as to the source of wages. Even among those 
who accept the theory that the wages question is a prob- 
lem in distribution, and that wages are paid out of pro- 
duct, there is an impression that the employer pays wages, 
and that therefore he has a certain superior right to de- 
termine what these shall be and to settle the conditions 
that affect the rates of wages. It seems scarcely necessary 
to remark that in no true sense are wages paid by the 
employer. Under the organization of industry, the pro- 
duct, the result of the joint effort of employer and 
employed, goes into the keeping of the former and he 
advances to labor what has been determined upon as its 
proportion, recouping himself for this advance from the 
pledge in his possession — that is, the laborer's proportion 
of the product. The object of the employer is profits, 
and it is the business of the employe to see that they are 
not excessive. When any change is proposed in wages 
or methods of work it is the employe's right to know the 
reasons for the same, and to refuse to accept those ad- 
vanced as conclusive as to the necessity for the change if 
they do not, after inquiry, so appear to him. The as- 
sumption of many political economists that the interests 
of these two classes are identical, that the employer is best 
able to judge what is expedient, and that therefore the 
employe should trust his interests to him, assured that if 
he takes excessive profits they will, under the action of 
economical forces, be restored speedily and surely in 
increased wages, is both absurd and dangerous. The 
tendency of these economical forces under present con- 



12 LABOR DIFFERENCES 

ditions is the perpetuation and deepening of industrial 
injustice. The interests of employer and employed are 
not identical in the sense intended. It is the interest of 
the former to give as little, of the latter to get as much as 
he can ; and to concede to the employer any but an equal 
right with the employe in deciding the conditions of em- 
ployment would undoubtedly result in the industrial 
degradation of the workingman. The argument is similar 
to that advanced to justify slavery or rule by an oligarchy. 
The only way in which the rights of either class can be 
secured and maintained is by placing them in their own 
keeping. Labor is as competent to care for its interests 
as the employer is to care for his, and more so than the 
latter is to care for them. 

In seeking, then, a method for the prevention or adjust- 
ment of labor differences, care should be taken on the 
one hand not to assume conditions that have passed away, 
and thus to adapt the method to a state of affairs that no 
longer exists. Equal diligence, on the other hand, should 
be given to ascertaining what are the conditions of the 
present, in view of which the method is to be applied 
These conditions and the method should be sought with- 
out any preconceived ideas as to what are economical 
truths. As in practical legislation " the first step is to 
throw aside all supposed absolute rights or inflexible 
principles," so in formulating an expression of the way in 
which it is conceived that these difficulties can best be 
met, no preconceived idea of what is economically sound 
should stand in the way of the adoption of what either 
experience or reason shows may be effective. The thing 
sought is a practical rule, a mode of action, not the dis- 
covery of scientific truth. The end will often be found 
only as the result of the balancing of probabilities of good 
and evil. 



AND THEIR SETTLEMENT. 1 3 

It is also important, whatever may be adopted, that the 
parties to the differences, if they do not always, as it is 
impossible they can, accept the result reached as correct, 
shall at least have such confidence in the method by 
which it is attained as to accept it. 

It should also be constantly kept in mind that it is 
chiefly " differences " and " disagreements," not " strikes 
and lockouts " that are to be avoided and settled. Too 
much stress cannot be laid upon the fact, so often ignored 
or forgotten, that strikes are not the beginnings of in- 
dustrial strife. Their source is in the differences and the 
controversies to which such differences lead. It is also of 
the highest moment to realize that industrial peace, with 
all of its blessings, is to be best secured, not by settling 
strikes and lockouts when they arise, but by preventing 
their occurrence. 



14 LABOR DIFFERENCES 



CHAPTER III. 

METHODS FOR SETTLING LABOR DIFFERENCES. THE 

THEORY OF COMPETITION. 

A consideration of the methods suggested for the 
prevention or settlement of labor differences shows the 
prevalence of two widely dissimilar theories as to the 
proper mode of procedure. One assumes the existence 
and efficacy of what are termed economical laws or forces, 
whose action is inevitable, and to which, without any in- 
terference, must be left the settlement of these vexed 
questions. The other theory, while it recognizes the ex- 
istence, and, within certain limits, the authority, of 
economical laws, denies that they are fixed and unalter- 
able, and asserts both the right and obligation of inter- 
ference under certain conditions. 

In the application of these theories the advocates of the 
first insist that all labor differences and disputes not only 
shall be, but in the nature of things ultimately must be, 
left to settle themselves by free competition between the 
individuals interested, without any attempt on the part of 
the state or of other individuals to control the result. 
The advocates of the second theory insist upon the right 
of interference, not only for the purpose of directing or 
limiting the action of what the first class term economical 
laws, but even for their contravention or abrogation. 
This interference is usually exercised by some organized 
body, as the state, trades-unions, employers' associations, 
or by committees or boards composed of both employers 



AND THEIR SETTLEMENT. 1 5 

and employed, formed for the specific purpose of dealing 
with these questions. The advocates of this theory do 
not assert that all methods or all instances of interference 
are wise or effective, nor do they feel bound to adopt and 
approve all measures that refuse to recognize the princi- 
ple of laissez faire in dealing with differences between 
employer and employed. They only assert the right of 
interference, leaving each expedient to be judged by itself. 

Under these two theories four methods have been sug- 
gested for the prevention and settlement of labor differ- 
ences : 

1 st. Laissez faire or Competition. 

2d. Legislative Enactments. 

3d. Strikes and Lockouts. 

4th. Arbitration and Conciliation. 

The first of these methods recognizes the validity of 
the first of the theories above stated. The last three are 
all based upon the second theory, but the modes of inter- 
ference with the so-called economical laws differ, being 
respectively, by statutory law, by force, and by reason. 
The first method will be considered in this chapter, leav- 
ing the discussion of the others to a subsequent one. 

By far the most prevalent of these theories is the first, 
that of laissez faire, or of unrestricted competition. There 
is rarely a discussion of labor differences, whether it be 
theoretical or practical, in which there is not urged this 
theory of the sufficiency of competition. It is asserted that 
not only will competition determine accurately and in- 
evitably what is a " fair day's wage " for a " fair day's 
work," but that it will redress all economical grievances 
and level all inequalities. Even when it is acknowledged 
that there is not perfect competition, its advocates will 
disguise it, often unconsciously, under other names, as 
the law of supply and demand, and insist upon the 



1 6 LABOR DIFFERENCES 

absurdity, as well as the criminality, economically, of any 
interference with these so-called immutable laws. 

This theory, as is well known, assumes that both em- 
ployer and employe understand what is their highest 
interest in an economical sense, and will surely seek it. 
The employer will inevitably strive to get his work done 
at the lowest possible price, and the employe will as 
surely endeavor to secure the highest possible wages, and 
as the result of this contest waged by each to get all he 
can, there will result perfect justice to all. If from any 
cause there shall be temporary injustice — that is, if wages 
are too high or too low, or some "of the conditions of 
work too oppressive or too lenient, then under perfect 
mobility, which is also assumed, labor will seek that place 
or that employment where this wrong does not obtain, the 
existing evils will be corrected, and the conditions again 
become those of exact justice. 

The sufficient objection to this theory is that under the 
constitution and methods of the industrial society of to- 
day, which is the one in whose interest we are seeking a 
way out of these difficulties, there is not and cannot be 
that mobility of labor, that perfect facility of movement 
from one point to another, or from one employment to 
another, which is the essential condition and only justifi- 
cation of this theory. It is not denied that there is a 
degree of mobility, but it is by no means as great nor as 
prompt and unimpeded as is claimed. The obstacles in 
its way are not exceptional and temporary, but many and 
serious. They grow out of all the relations, social, politi- 
cal, and religious, which the members of industrial society 
hold to each other and to the society in which they live, 
and they exist in varying degrees and varying phases in 
all industries and all nations. 

A moment's consideration of the facts evident in our 



AND THEIR SETTLEMENT. \J 

own country, where the mobility of labor is perhaps greater 
than in any other, will show the wellnigh insurmount- 
able obstacles to this assumed facility of movement, and 
consequently the utter inadequacy of any method for 
harmonizing the relations of employer and employed 
based upon this theory. Chief among these at the pres- 
ent moment is the opposition to what is termed " foreign 
labor." This is most marked and general against the 
Chinese. It is as bitter, however, in many sections, 
notably in some of the mining regions of Pennsylvania, 
against Italians, Hungarians, Pole's, and other nationalities. 
This opposition has found national expression in the pass- 
age by Congress of the " Anti-Chinese Bill " and the 
" Contract-Labor Bill." Of a similar origin and character 
is the opposition to what is known in different industries 
as " black-sheeping," "ratting," or "scabbing," or the 
acceptance of employment by working-men at rates of 
wages or upon terms not acceptable to their fellows. 
This opposition is also directed against those workmen 
who accept, even upon terms and wages that are satisfac- 
tory, the situations of other workmen who have been 
"victimized" or refused employment because of their 
advocacy of the employe's side, or of their refusal to 
adopt the views of the employer in time of difficulty and 
differences. The violence that has attended the employ- 
ment of foreigners, as well as that frequently following 
an effort of labor to transfer itself, either upon its own 
volition or under agreements with employers, from one 
section or one industry to another; in a word, the at- 
tempts of labor to migrate, to seek the best market, are 
often so costly, so dangerous to person and property as 
to seriously obstruct mobility where the conditions re- 
ferred to exist. 

Where there is neither personal violence nor wanton 



1 8 LABOR DIFFERENCES 

destruction of property, there is frequently a social and 
industrial outlawry visited upon workmen who " black- 
sheep," that is more feared and dreaded than either. 
This sentence of outlawry is passed without appeal, and 
by a body not amenable to any power. It is scarcely 
ever removed. It bars the way to social enjoyment, to 
friendly intercourse, and, if possible, to future employ- 
ment. It follows the victim into all the relations of life, 
and falls with most crushing force upon his wife and 
children, if, unfortunately for him and them, he is thus 
blessed. This is one reason why in many strikes it is 
found that the women and children are most persistent 
in urging no surrender. With all this sure to come, he is 
a man of more than ordinary courage, or compelled by 
an impulse of unusual force, who would accept a situa- 
tion temporarily left vacant in consequence of a labor dis- 
pute, or who would continue or resume work at rates or 
upon conditions his fellows decline. In a word, under 
these conditions, in many industries, mobility of labor is 
wellnigh absent. 

In addition to the class of obstacles to mobility, of 
which those already named may be regarded as types, 
and which are the results of active opposition from without, 
there is another class full as potent and more universal, 
which are mainly subjective, and arise from the constitu- 
tion and environment of the individual. Among these 
are attachment to home and friends and locality, those 
arising from timidity, or fear, or ignorance, and, more 
than all others, that positive prohibition of movement 
growing out of the want of food upon which to subsist 
while seeking the best market, and of the money necessary 
to migrate to the same. How, for example, can a laborer, 
burdened with debt and a family, change his employer 
or shift his place ? The mobility of labor is to him a 



AND THEIR SETTLEMENT. 1 9 

hollow mockery, and any method for securing to him 
justice based upon mobility a heartless farce. He can 
only submit in sullen despair to every exaction and every 
injury. 

In view of all these obstacles to the mobility of labor 
it is difficult to understand how this theory of competi- 
tion, based upon an assumption that is false, can honestly 
be offered .as a sovereign remedy for labor difficulties. If 
it be asserted that these obstacles are exceptional and 
temporary, I answer that experience shows the contrary. 
They are constant in their action, and some of them recur 
with rapidly increasing frequency. If it is urged that the 
difficulty rests not with the theory but with the obstacles, 
and that these can be removed if economical laws are but 
allowed full play, I answer that there is wide difference of 
opinion as to what are economical laws, many urging that 
these obstacles are as legitimately economical forces as 
the forces with which they interfere. The magnetism 
which arrests the iron falling to the earth, under the 
impulse of gravity, is as legitimate a force as gravity 
itself, and, properly applied, as beneficial. Associated 
action may be as legitimate a force as gravity, and, 
properly applied, as beneficial as competition, or indi- 
vidual action. But however strongly it may be urged, 
there is no evidence that competition will remove these 
obstacles, or, if it does, that it will act in the interests of 
justice. The tendency of economical forces acting with- 
out direction or guidance is not to right economical 
wrongs, or establish justice, but to perpetuate and aug- 
ment existing burdens and add others. 

I have dwelt upon this failure of labor to seek surely 
and swiftly the best markets because mobility is an essen- 
tial condition of the theory of competition, and if from 
any cause it fails, either in whole or in part, then to that 



20 LABOR DIFFERENCES 

extent at least, and in the circumstances in which it fails, 
competition is inoperative and does not furnish a method 
for the prevention or settlement of labor difficulties. 

But there are other directions in which this theory of 
competition either fails altogether, is operative only to 
a limited extent, or is subject to control and regulation. 
There is, for example, in the assumed potency and in- 
fallibility of the law of supply and demand, an' assertion 
of the sufficiency of competition that is wellnigh univer- 
sal, and yet competition in this phase has by no means the 
authority nor the efficacy that is popularly ascribed to it. 
This law is assumed to affect and regulate wages in two 
ways : First, the supply of labor increases or decreases 
wages as it is less or greater than the demand ; and in 
the second place, the supply of goods produced, in pro- 
portion to the demand for the same, fixes their price, and 
consequently, indirectly, the wages that can be paid in 
their production. 

That this law has an effect in both of these directions 
cannot be questioned, but that it fails to act altogether 
under certain conditions, as of combination, that it has a 
limited effect in others, and that it is always subject to 
control or regulation, are equally true. There are many 
cases in which labor, while it has permitted this law a 
certain range, has said to it " thus far and no farther," 
and in the face of a marked and evident over-supply of 
labor, and, notwithstanding serious reductions in the 
prices of product, it has fixed and maintained through 
a series of years' a limit below which wages have not been 
permitted to fall. Combinations of manufacturers have, 
in like manner, in the face of an over-supply, maintained 
and advanced prices, and so avoided the necessity of 
wages reductions. 

These are evidences of the power of both employer and 



AND THEIR SETTLEMENT. 21 

emyloye' in the presence of an over-supply of both labor 
and product, to control, and, at certain points, prevent 
entirely, the action of this law. Experience further shows 
the power of both, for a time at least, to regulate and con- 
trol the supply, and in a less degree the demand, for goods 
and labor, and thus modify the action of the law. Restric- 
tion of production by individuals or combinations, assisted 
immigration, rules regulating the number and qualifica- 
tions of those who shall be taught certain skilled trades, 
are some examples of the exercise of this power. It may 
not always be wisely used, but the power exists. 

There is one feature of the action of this law of supply 
and demand, as it relates to wages, that is deserving of 
careful consideration. This law involves the assumption 
that labor is a commodity to be bought and sold, and 
that the price of this labor is to be determined, as is the 
price of all other commodities, in the open market. 
Without stopping to discuss whether labor is a commodity 
in the same sense or subject to the same rules that apply 
to a bale of cotton or a ton of lead, it is pertinent to ask, 
granting that it is, Where is the labor market where buyer 
and seller can congregate, and where can be carried on 
what Adam Smith terms the " higgling and bargaining of 
the market " ? The price due to supply and demand is 
not indicated by a single transaction made in private, nor 
in a multitude of such transactions made publicly. A 
year hence these private transactions may become known, 
and then we can tell what the market was to-day ; but 
this is of no practical value to the laborer who wishes to 
sell his labor to-day. What he needs is some labor ex- 
change, where numerous buyers and sellers can come 
together, with its bulletins, with authentic information as 
to abundance or lack of orders, its figures of accumulated 
stocks, competition, and other elements that determine 



22 LABOR DIFFERENCES 

supply and demand, and out of the multitude of whose 
transactions one can deduce a mean, which is the state of 
the market. Is there any labor market except as an ab- 
stract idea ? Is it not folly to say that the transactions 
between an individual and an employer in the privacy of 
a counting-room, with hunger and want forcing the la- 
borer perhaps to accept what is offered — is it not folly to 
say that such a transaction, or any number of them, con- 
stitutes in any sense that is a practical one, an open labor 
market, where the law of supply and demand has free 
action ? Even if it did, must industry halt or accept 
wages below the market, or must the employer pay wages 
above the market until out of the thousands of these in- 
dividual transactions, spread over a considerable period, 
the true market be established ? No number of private 
transactions can make a market open, free. If demand 
and supply regulate wages, then there is an urgent neces- 
sity for a market where the wages of labor can be adjusted 
without waste or delay. 

There is another direction in which the laissez-faire 
method fails to be the perfect cure for labor differences 
its advocates assert it to be. Granting to competition all 
that is claimed, there is still a large class of questions 
which, from their very nature, it is powerless to determine. 
Among these may be mentioned those involving the in- 
terpretation or enforcement of agreements entered into 
between employers and employed. It is difficult to con- 
ceive how competition can define the meaning of am- 
biguous terms, or how, in case of a difference as to what 
the custom of a trade is, laissez faire could surely and 
speedily settle it, even when these questions involve 
honest differences of opinion. It might perhaps settle 
the meaning for the future, or determine what the custom 
shall be, but this is not by any means the same as deter- 



AND THEIR SETTLEMENT. 23 

mining the true meaning of the contract as originally 
drawn, nor as deciding as to work done. When the 
difference is not an honest one, and need or greed com- 
pels the acceptance of a forced or wrong interpretation, 
then there is no settlement which deals out to both 
employer and employed exact or even approximate 
justice. 

I trust that I have succeeded in establishing what 
observation and experience appear to me to prove — the 
utter inadequacy of competition under existing conditions 
for the prevention and settlement of labor differences, 
and that there are forces, which at times are more power- 
ful than the assumed individual impulse toward the best 
market, which regulate and modify and even thwart com- 
petition. 

But it may be pertinent to ask, even granting this, is it 
as it should be ? Is it wise to prevent or in any way im- 
pede the action of this force ? Those who assert that this 
law is an eternal and immutable one will answer no. It 
may, however, in opposition to these economists, be fairly 
questioned if there are any economical laws with the au- 
thority claimed for this one, or that impose upon the indi- 
vidual or upon society any such obligation as is assumed to 
exist in competition. In discussing the principles of indus- 
trial legislation, the late Prof. Jevons says : " The first step 
must be to rid our minds of the idea that there are any 
such things in social matters as abstract rights, absolute 
principles, indefeasible laws, unalterable rules, or any thing 
whatever of an eternal and inflexible nature." This is 
equally true of discussions of labor differences. There 
are no economical forces that are eternal and command- 
ing. The so-called laws are only expressions of an ob- 
served tendency of affairs or of human action. When 
there is an observed tendency in other directions, then 



24 LABOR DIFFERENCES 

the law which is its expression, is as commanding in its 
own sphere as that of competition and may clash with it. 
Which of these laws or forces it is best to apply in a given 
case is entirely a question of probabilities and degree, 
not of right and obligation. 

On the whole, I do not believe that the tendency of the 
theory of unrestricted competition and the play of this law 
in production and distribution are conducive to the high- 
est good. It teaches that man is to be regarded as 
governed by but one, and that not the highest nor most 
powerful of human motives — the desire to acquire and 
consume wealth, a desire that has brought untold misery 
to mankind. It asserts the right of the buyer to purchase 
commodities at the lowest possible price to which he can 
force the same, and denounces as interfering with an eter- 
nal law any attempt on the part of the seller or the work- 
man in combination with his fellows to maintain a price or 
a wage that shall preserve his financial existence, or give 
him the necessaries and some of the comforts of life. It is 
by no means self-evident, nor is it capable of proof that it 
is in accordance with public policy that goods shall be sold 
at rates that mean great loss or ruin to the manufacturer, or 
that wages shall be paid that mean distress to the workmen, 
when by combining, fair profits and good wages can be 
obtained. It also denies to a score of employers or em- 
ployes associated together the right to pursue a course 
which their judgment dictates, while it would freely con- 
cede to the same score of individuals acting as individ- 
uals the right to pursue precisely the same course. This 
is absurd. 

Further, the logical results of the application of the 
theory we have been discussing are strikes and lockouts. 
The theory assumes that when wages are too low the em- 
ploye will and should seek other employment ; that is a 



AND THEIR SETTLEMENT. 2$ 

strike : when too high, the employer will cease production, 
or give employment to those that will accept the rate he 
judges he can pay ; that is a lockout. If the theory of 
competition is sound, then these stoppages, — these strikes, 
are not only justifiable, but are absolutely necessary and 
commendable. 

This theory is most dangerous in its teachings and 
tendencies. If it be taught as true and as the only 
theory which accords with eternal law, that there is an 
irresistible impulse on the part of both employer and em- 
ployed for each to get all he can as against the other, 
governed in his action only by his desire to accumulate 
wealth, and that such an impulse and desire are commend- 
able, then each is justified in acting upon this selfish de- 
sire without reference to any other motive of human con- 
duct. This means contest, continually, logically, and 
justly so. The views of employer and employe as to 
what are fair wages or fair profits scarcely ever agree, 
and then comes strife, for each will try to impose his 
views upon the other. This theory, then, places the two 
chief classes of industrial society over against each other 
and urges them to the conflict, calmly and complacently 
assuring them that out of this selfish struggle will result 
complete justice. This is a most dangerous theory to 
teach men. It strikes at the stability of society. It 
means anarchy. May not ignorance or greed answer in 
the hour of their partial triumph : You taught us that the 
controlling and only motive of human action, so far as 
relates to production and distribution, is the desire to get 
wealth ; it is upon that motive we act. 

But beyond all this, the suggestion that competition 
should be the controlling motive of human action in con- 
nection with economical matters is out of all harmony 
with the spirit of the civilization in which we are placed. 



26 LABOR DIFFERENCES 

It is asserting the necessity and rightful dominance in 
civilized society, which is based upon association, of the 
spirit that is the ruling one in the lowest state of savage 
and brute existence, that of struggle, of contest, of com- 
petition. Its methods may be somewhat different, but it 
is none the less the same spirit and seeking the same 
ends. " 'T is true, and pity 't is 't is true," that 
" trade is utterly selfish," and it will always be so while it 
is taught that competition should be the governing force 
in its transactions, but it is neither necessarily nor justly 
selfish. The tendency of the teachings as to the proper 
motives of action in all other relations of human life is 
against selfishness. There is ever a determined effort to 
reduce its influence to the lowest point. I submit, therefore, 
that it cannot be true that selfishness is the proper motive 
nor that its methods are commendable in this sphere of 
activity that consumes so much of the time and thought 
of civilized society. Such a belief involves the assertion 
that the principle underlying the instructions of that mar- 
vellous Teacher, himself from the ranks of labor, and who 
had the deepest knowledge of the springs of human 
action, was a false one. The theory of Christian civiliza- 
tion is ntft of competition but of association. 



AND THEIR SETTLEMENT. 2*] 



CHAPTER IV. 

METHODS FOR SETTLING LABOR DIFFERENCES (CON- 
TINUED). — THE THEORY OF ASSOCIATION. 

The second theory regarding methods for preventing 
and settling labor differences I have termed the Theory 
of Association, as it is usually through associations of in- 
dividuals that its action becomes manifest. 

This theory, while recognizing the existence and, 
within certain limits, the authority of what the advocates 
of competition or individual action regard as the only 
legitimate economical laws, denies that they are fixed and 
unalterable, and asserts both the right and obligation, 
under certain circumstances, of interference with these 
laws and their action. It also asserts the existence of 
other forces as legitimate and commanding as competi- 
tion, and of agencies through which these forces, compe- 
tition included, may not only be rightfully applied, but 
through which new industrial conditions may be created 
and existing ones removed or modified. At the same 
time it does not assert that all methods, nor all agencies, 
nor all instances of the use of these methods and agencies 
are wise or effective, nor do the advocates of this theory 
feel bound to adopt and defend all measures refusing to 
recognize the principle of laissez fairc. Each must be 
considered and judged by itself. 

As to the rightfulness of this theory of associated ac- 
tion, it may be said that in all other departments of hu- 
man activity, in church and state, in efforts for moral and 



28 LABOR DIFFERENCES 

social advancement, in benevolent and humanitarian 
work, this principle not only prevails, but experience 
proves that it secures the most efficient action and the 
best results. Even in the departments of activity to 
which the questions we are considering pertain, produc- 
tion and distribution, this is the ruling mode of action. 
Capital is associated and labor is associated in the pro- 
duction and distribution of goods, and as a result of this 
combined action, they are produced cheaper and dis- 
tributed at a lower cost and more swiftly than they could 
be by the old methods of individual action. • The inven- 
tion of the steam-engine, and the resulting abandonment 
of the domestic system, and the prevalence of the factory 
system, as well as the adoption of other methods of asso- 
ciated action, have largely multiplied the efficiency of the 
individual, increased wealth, and improved the working- 
man's condition. I confess I see no reason why this 
principle, which is so universal in other directions, and so 
beneficial, should not be brought to the discussion and 
settlement of these questions that arise between employer 
and employed. So far as I am aware, competition or in- 
dividual action has in no instance been imposed upon 
humanity by any competent authority, while it is beyond 
question that the only absolute and unerring authority 
recognized generally in the civilized world has imposed 
upon mankind the principle of associated action. 

But whether the rightfulness of associated action be 
recognized or not, there is a necessity and obligation that 
should compel its adoption. The individual cannot 
ignore the fact that he is a part not only of society as a 
whole, but of one or more of the groups into which it is 
divided. He must not and can not in justice be permit- 
ted to refuse or even to neglect to consider what the 
effect of his action upon others associated with him in 



AND THEIR SETTLEMENT. 29 

various relations may be, and he is bound to have in view 
their interests. He cannot act as an isolated individual. 
He must recognize and in a measure conform to their 
wishes and their judgment ; that is, he cannot act en- 
tirely upon his own judgment " in subjection only to his 
own sense of his own interest." 

Further, the basis of action, whichever theory is 
adopted, is supposed to be judgment, in one case that of 
the individual, in the other that of the association. Now 
which judgment is more likely to be correct ? " The 
crowd," says Aristotle, " makes better general judgments 
than any individual whatever." . . . " The multitude 
is less liable to sinister influence than the few, for 
when the individual is influenced by passion or any simi- 
lar impulse, his judgment must be distorted, while it is 
hard for all collectively to be led by passion or to err." 
Reasoning a priori it would appear that the judgment of 
the many, of the association, is more to be trusted in 
these labor matters than that of the individual. In 
making this statement it is not forgotten that the crowd, 
if it is a mob, may be inflamed and act with a want of 
judgment that the individuals would not have manifested, 
but the associated action of which we speak is not that 
of a mob. It is also true that when the association is 
made up of the members of but one class, with the same 
purpose, the same grievances, the same passions, the 
judgment may be a biassed one, but not necessarily more 
so than that of each individual, and a biassed judgment is 
not always an unjust one. But when the association is 
made up of both classes and from both parties to these 
differences, then the judgment of such a body, with its 
opportunities for ascertaining both sides of the question, 
and for securing information that is not possessed by 
both, then the probabilities are that the determinations of 



30 LABOR DIFFERENCES 

such a body are more nearly right than those of individu- 
als actuated only by their individual sense of their own 
interests. 

As we stated in the preceding chapter, three modes of 
procedure under this theory of association have mani- 
fested themselves, as follows : 
Legislative Enactments. 
Strikes and Lockouts. 
Arbitration and Conciliation. 

The first of these methods is by that association of in- 
dividuals called the state ; the second, by associations of 
employers and employed in antagonism 1 ; the third, by 
associations of employers and employed co-operating. 

There are two distinctly marked epochs in the history 
of labor legislation. The first marked the dominance of 
the employer. In it all legislation relative to labor was 
in his interest and had as its objects " to cheat the work- 
man of his wages, to tie him to the soil, to deprive him of 
hope, and to degrade him to irremediable poverty," and 
this not as the result of accident or inadvertence, but 
by the deliberate malignity of governments and parlia- 
ments.* In the second epoch, the present, the tendency is 
to the removal of the burdens which custom and centuries 
of unjust legislation have placed upon labor, and the en- 
actment of new laws for its protection and benefit. The 
first epoch may be regarded as beginning with the ordi- 
nance of Edward III. in 1349 ; the second, with the elder 
Sir Robert Peel's act in 1802. 

It is chiefly to England that we must look for that body 

1 There may be strikes and lockouts that do not involve an associa- 
tion of either employer or employed, but they are rare. A combina- 
tion is usually a feature of these labor contests. 

2 " Six Centuries of Work and Wages," Prof. J. E. Thorold Rogers, 
New York, 1884, page 398. 



AND THEIR SETTLEMENT. 3 1 

of experience which will enable us to judge of the wisdom 
and efficiency of legislative enactments as a method for 
dealing with labor questions. In the first epoch, that of 
the dominance of the employer, English law and those 
who administered it sought chiefly the accomplishment of 
five ends : 

1st. The regulation or fixing of wages. 

2d. The prevention of the " locomotion " of the 
laborer. 

3d. Enforced service. 

4th. The prevention of combinations of labor. 

5th. The industrial slavery of youth, or compulsory 
apprenticeship. 

It is not my purpose to recite the story of the legislation 
of these five hundred years, nor to detail the struggles of 
labor against its iniquities. All attempts to secure by 
legislation the ends named have been definitely and 
probably finally abandoned. The experience of these 
centuries has taught not only the injustice and injury 
to all classes of such attempts, but the futility as well. 
As a means of dealing with questions that are properly 
classes under these heads, legislative enactments may be 
regarded as condemned by the verdict of experience. 

In the second epoch the chief work of legislation has 
been the removal of the iniquitous and oppressive laws of 
the first period. In addition to this there has grown up a 
body of positive legislation, largely in the interest of the 
employe, of a very different character from that of the 
first epoch, and dealing with entirely different subjects. 
These laws relate chiefly to the health and safety of life 
and limb of the workman, though in some cases they 
have sought in other ways to secure and increase his 
welfare. Among the positive provisions for the benefit 
of the employe are those regulating the hours and condi- 



32 LABOR DIFFERENCES 

tions of employment in certain dangerous and unhealthy- 
trades, as mining and match-making ; those defining and 
extending the liability of employers in cases of accident 
and death ; those regulating and, in many cases, forbid- 
ding, the employment of women and children ; those pro- 
viding for the inspection of factories, workshops, and 
mines ; those forbidding truck, regulating the frequency 
and place of payment of wages, the hours of labor, the 
methods of screening and weighing coal, etc. 

All of these laws relate to subjects that have been pro- 
lific causes of labor differences, and to the extent that 
they regulate or deal with them, to that extent, at least, 
they reduce or remove the liability to discontent. 

As to the wisdom and right of most of these laws, there 
is on the whole a general agreement. Some who are con- 
cerned as to the fate of certain theories, and others with 
whose interests they seem to conflict, condemn them and 
hold that in all or most of these matters the individual 
is amply able and should be left to protect himself. On 
the other hand, not only employes, and the wisest of 
modern economists, but even employers are coming to 
realize that these laws are not only just but that they are 
wise as well. Many causes of dispute have been removed 
and labor has been made more efficient, more intelligent, 
and more contented. The fear as to the evil results that 
would ensue has not been justified, but, on the contrary, 
benefit instead of injury, strength instead of weakness, 
have been the consequence. 

The failure of the legislation of the first epoch, as well as 
its unjust character, cannot fairly be urged, as it frequently 
is, as conclusive against all legislative interference with 
labor questions. The legislatures of this period were for 
the most part the representatives of the aristocratic class, 
not of the people, and the legislation was essentially class 



AND THEIR SETTLEMENT. 33 

legislation, solely in the interests of a class, and that class 
not the people. The legislatures of the present are more 
nearly representative of the people of all classes, and 
their enactments are consequently more likely to be in 
the interest of all ; its judgments, as in the framing of 
them all classes unite, or, at least, all classes can make 
their wishes known, are surer to have in view and to 
register the combined wisdom of the state, and therefore 
to be more accurate and just. 

The method of dealing by legislative enactments with 
questions such as those just mentioned is, we think, on the 
whole, a safe, wise, and effective one. The manner, the 
occasion, and the use of the law must always be some- 
what in doubt, and at times raise most serious and com- 
plicated questions. Mistakes will be made, but these will 
soon manifest themselves and be corrected. The diffi- 
culty will not be with the method but with its application. 
As human judgment is, after all, the ultimate resort and 
the controlling influence in whatever method is adopted, 
it is as fair to presume that in those matters which ex- 
perience has shown to be legitimate subjects of legislative 
enactment, the judgment of Parliament and legislatures, 
elected as those of the present day in English-speaking 
nations are, will be as correct as that of individuals 
moved by a desire to procure wealth. 

Probably no subject connected with labor differences 
has been more thoroughly discussed than that of the 
advisability and rightfulness of strikes and lockouts. In- 
deed, this whole subject in many minds resolves itself 
into a question how to avoid and settle strikes and lock- 
outs, and not what method shall be adopted to prevent 
or remove labor differences, which are the cause of these 
labor contents. 

That the statistics of strikes and lockouts seem to 



34 LABOR DIFFERENCES 

prove their folly cannot be denied. The waste and loss 
and misery resulting from them is unquestioned, and the 
direct results secured not at all proportionate to the cost. 
Statistics also show that strikes are not, as a rule, suc- 
cessful in obtaining the specific thing demanded. In the 
writer's Census Report before referred to, statistics more 
or less complete are given of 762 strikes that occurred in 
the United States in 1880. In 414 of these, 128,262 
persons were engaged. The report gives quite full re- 
turns from 226 strikes, in which 64,779 persons took part. 
The time lost was equal to the work of one man 1,989,872 
days, and the wages unearned for this time $3,711,097. 
Of the direct losses in the remaining 506 strikes no 
statement was received, nor of the indirect losses to 
capital, to the workmen not directly engaged, and to the 
wealth of the country. It is probable that the striking 
workmen recouped their losses in part from their society 
funds and from contributions, as well as by working at 
other employments ; but after all allowances are made, it 
still remains a deplorable fact that the waste and loss 
from these strikes was enormous. 

A paper on strikes in Great Britain from 1870 to 1879 
was recently published by Mr. G. Phillips Bevan. Re- 
ports and some information concerning 2,352 strikes are 
given. The "loss in wages" alone from 114 of these 
strikes was $5,067,825. Of 351 of the strikes reported 
upon by Mr. Bevan, 189 were unsuccessful, 71 success- 
ful, and 91 compromised. Of 149 reported upon by the 
Massachusetts Bureau of Labor Statistics, only 18 were 
successful, 109 unsuccessful, 16 compromised, and 6 par- 
tially successful. A report of the Pennsylvania Bureau 
on 135 strikes, showed 45 successful, 66 unsuccessful, 13 
compromised, and it partially successful. The census 
report gives the result of 481 strikes, of which 169 were 



AND THEIR SETTLEMENT. 3$ 

successful, 227 unsuccessful, and 85 compromised. This 
report shows also that the workmen are more successful 
in strikes growing out of demands for advances than they 
are in resisting demands for reductions. With the ex- 
ception of the census report, these statements cover a 
series of years, including periods of great depression in 
business as well as prosperous times, and may, therefore, 
be regarded as giving fairly average results. 

Of the utter folly of many strikes, there can be no ques- 
tion. They have been doomed to defeat from their in- 
ception. They have been undertaken in defiance of all 
economic laws, in ignorance of the real condition of trade, 
and without any just cause. They have wasted capital 
and decreased the wealth of the country. They have 
brought hunger, misery, debt ; have broken up homes, 
severed long associations, forced trade to other locali- 
ties, and driven men, women, and little children into the 
very shadow of death ; and yet, men knowing that all of 
these possibilites are before them, will deliberately enter 
upon strikes — will cheerfully bear all of these privations, 
and, what is more remarkable still, in many instances 
the wives of the strikers, upon whom the misery falls 
with the most crushing force, will be the most deter- 
mined in their resolution. It would seem that there 
must be some reason for this, and I believe it will be 
found that strikes are not wholly wrong, and that even 
unsuccessful ones are in many ways advantageous to the 
strikers. Labor has had to fight for every advantage it 
has gained, and though it is often defeated in its strug- 
gles that are called strikes, it has not only learned in 
these contests how better to wage future battles, but it 
has so impressed employers with its strength, that it has 
made them shy of encountering antagonists constantly 
growing more formidable. 



36 LABOR DIFFERENCES 

It has also made employers more willing to examine as 
to the justice of demands made upon them, and to meet 
the employes in a spirit of fairness when differences arise. 
The most hopeful indication of modern industrial soci- 
ety is the great increase of mutual respect and good-will 
between employers and employed, as well as a greater re- 
gard on the part of each for the rights of the other. To 
this result strikes have contributed in no small degree. 
They have also asserted the right of combined labor to 
deal with combined capital, and have denied the claim 
that the true labor market was found in the " higgling " 
of capital with all its power, and one individual workman 
with his weakness and necessities. 

And yet this method is one of force, and does not, af- 
ter all, settle any thing. When the battle has been joined 
and the contest decided (a decision very rarely the re- 
sult of judgment and reason, but one forced by other 
considerations), what has been gained ? what decided ? 
A battle has been fought, a victory won, or a defeat suf- 
fered. That is all. No principle has been established — 
no question decided. And what is a victory won under 
such circumstances worth ? For what does it count in 
the light of our civilization ? Have 6,000 years of toil 
with this labor problem ever pressing, found no better 
judge, no kindlier umpire than brute force — than hun- 
ger and greed ? At the end of every strike or lockout 
there is always one practical problem that loudly and 
urgently demands a solution — to find some means by 
which the existing organization of industry, not some 
system yet to be devised, can be made to work without 
these wasteful contests that are so frequent as to seem 
wellnigh an essential part of the system. 

It should also be noted that in the method of strikes 
and lockouts there is no place for that exercise of judg- 



AND THEIR SETTLEMENT. 37 

ment based upon information and upon a knowledge of 
the condition and circumstances of both parties to labor 
differences that are essential to justify the method by 
association. 

The third method of dealing with labor differences 
based upon the theory of association is that of arbitration 
and conciliation. Briefly stated this method provides for 
the reference of these differences or the resulting disputes 
to boards or committees made up of both employers and 
employed, usually an equal number of each, each class 
selecting its own representatives. In these boards or 
committees the questions at issue are thoroughly dis- 
cussed, testimony is heard, and a decision reached which 
is final and binding upon all the parties to the reference. 
When the method is that of arbitration, in case an agree- 
ment cannot be reached by the board, one or more parties, 
— umpires — are called in, and the subject referred to 
them, their decision being equally as binding upon all as 
that of the board itself. With conciliation there is no 
umpire. The committee itself must reach a conclusion, 
or there is none by this method. 

These boards or committees, organized and conducted 
as the best experience dictates, with some power to give 
effect to their decisions, appear to me to offer the best, if 
not the only method, for a calm and intelligent considera- 
tion and discussion of the intricate and troublesome prob- 
lems that grow out of the relations of employer and em- 
ployed. They also offer the only method which promises 
decisions that shall be even approximately reasonable, 
just, and right. 

To the consideration and discussion of these questions 
there is brought in these boards or committees not the 
knowledge, perception, and judgment of one class only, 
which are apt to be imperfect, clouded, and biassed, but 



38 LABOR DIFFERENCES 

the combined intelligence, information, and judgment of 
both employer and employed, standing at different 
sources of information and looking at these questions 
from different points of view. This method takes cog- 
nizance of existing conditions ; recognizes the perfect 
equality of employer and employed ; commits the preven- 
tion and settlement of these differences to the reason and 
judgment of both, not to the selfish impulses of one ; re- 
fuses to recognize force ; does away with the necessity and 
excuse for strikes and lockouts ; permits due weight to 
be given to economical forces, and due consideration to 
any action their presence and power demand ; furnishes 
the nearest approach to a free, open labor market that has 
yet been established ; in a word, it meets better than any 
method yet proposed the conditions necessary to a satis- 
factory and intelligent discussion and settlement of these 
questions, and offers far greater surety that justice will be 
done and equality and peace established than does any 
method that relies upon blind, unreasoning, undiscrimi- 
nating law or force. 

It also furnishes what in the rapid changes of indus- 
trial conditions, what in the ever-altering phases of indus- 
trial society, varying with time and seasons, with locality 
and employment, is absolutely needed — a means for ex- 
perimenting, without danger, in ways and methods of 
dealing with these questions, a means which will permit 
of the speedy abandonment of any mode not found wise 
or useful. 

The particular constitution and methods of boards of 
arbitration and conciliation, as well as the results of their 
employment, will be given in succeeding chapters. 



AND THEIR SETTLEMENT. 39 



CHAPTER V. 

ARBITRATION AND CONCILIATION. 

Though the terms arbitration and concilation are 
jointly used to name the system of dealing with labor dif- 
ferences by boards or committees made up of both em- 
ployers and employed, these words by no means represent 
the same thing. Conciliation is properly applied to at- 
tempts to settle or prevent labor differences by confer- 
ences between the parties in interest, or their authorized 
representatives, these conferences having no power to 
reach a decision except as the result of mutual agreement. 
Arbitration, on the other hand, implies a conference and 
agreement, if possible ; in case no agreement can be 
reached, then the matter at issue is to be referred for 
settlement to one or more persons, whose decision is 
morally or legally binding upon both parties, In concilia- 
tion there can be a mutual agreement only ; in arbitration 
there maybe a formal and binding judgment. 

Recognizing this distinction between arbitration and 
conciliation, the bodies formed for applying this method 
to labor differences assume two forms : 

I. Boards or Committees of Conciliation, which employ 
conciliation only, 

II. Boards or Committees of Arbitration and Concila- 
tion, which employ both arbitration and conciliation. 

It is to be noted that the only practical difference 
between these two methods is the mode of reaching deci- 
sions. In the conciliation boards or committees the 



40 LABOR DIFFERENCES 

members must themselves agree ; in the arbitration 
boards a disinterested third party may be called in to 
render a decision. 

There is no little difference of opinion as to which of 
these forms is the better. While conciliation committees, 
usually by informal rather than by formal and organized 
action, have had some measure of success, the best and 
most effective work has been done by arbitration boards. 
It will be found that even conciliation has been most ef- 
ficient when connected with arbitration. It is true that 
arbitration recognizes conciliation and avoids the umpire 
if possible, thus conceding the greater desirability if not 
superiority of conciliation, and it undoubtedly is desirable 
that the parties themselves shall agree if possible, but the 
system would be inadequate to the demands upon it, did 
it not provide a method of reaching a decision in case, as 
frequently will happen, that the parties cannot or will not 
unite in one. 

It will be found, therefore, as a rule, in the practical 
workings of this system, that arbitration and conciliation 
are united, conciliation dealing with minor matters or 
questions of detail, or those affecting the individual or 
small bodies of men, and even with broader questions, 
when decisions can be quickly reached. Concerning 
such questions opinions are not as decided nor as 
tenaciously held. But when questions arise that affect in 
a serious degree the whole trade or large bodies of men 
or large amounts of capital, then the method of concilia- 
tion — of mutual agreement — is of little avail, and the um- 
pire is called upon. 

It has been urged as an objection to the arbitration 
form of these boards that the knowledge that the umpire 
will be called upon in case of a disagreement weakens the 
obligation resting upon the board itself to reach an agree- 



AND THEIR SETTLEMENT. 4 1 

ment, and makes the effort to do so a less honest one. 
This may be true to some extent, but it is not necessarily 
a disadvantage. A decision reached under the pressure 
of necessity may be neither just nor equitable. Indeed, 
necessity is never a safe counsellor in labor differences. 

It is also objected to arbitration that unlike concilia- 
tion it commits the decision of these questions to a single 
individual, who may not have the special or technical 
knowledge which it is assumed is necessary to enable him 
to decide intelligently or justly, or if one is selected who 
is acquainted with the trade, it is probable that he has at 
one time been either an employer or an employe and con- 
sequently may be biassed. The answer to this is that 
the settlement of most important industrial and trade 
questions, involving large interests and most intricate 
technical details, is every day submitted through our 
courts of law to the decision of persons not at all ac- 
quainted with the details of the industries or trades or the 
questions involved. A court of law in a civil action is to 
a great extent a court of arbitration, and when the issue 
turns on questions of usage, technical practice, or com- 
plicated accounts, it is not unusual for judges to hand 
over the decision to arbitrators who may be acquainted 
with the subjects involved. The experience of boards of 
arbitration is conclusive that both those skilled and un- 
skilled in the industries in which disputes are to be settled, 
have been most successful umpires. Sir Rupert Kettle, who 
has been eminently successful as an umpire in England, 
especially in the coal and iron industries, has no practical 
knowledge of these. Thomas Hughes, M. P., (" Tom 
Brown ") Mr. Herschell, M. P., Sir Thomas Brassey, M. 
P., Mr. Russell Gurney, Mr. Henry Crompton, and others, 
are all gentlemen who are not connected with manufactur- 
ing or mining, have no practical knowledge of their de- 



42 LABOR DIFFERENCES 

tails, but have been very successful arbitrators. On the 
other hand, Mr. A. J. Mundella, M. P., Mr. Joseph Cham- 
berlain, M. P., Mr. David Dale, and others, who have 
been just as successful umpires, are or have been very 
extensive manufacturers, while gentlemen like Mr. Bur- 
nett have been leading unionists. 

It will be found that the success of a referee will not 
depend upon his practical acquaintance with the trade, so 
much as it will upon the man himself. If he is at all 
fitted for his responsible position in other ways, he can 
get sufficient knowledge of the trade to enable him to 
give a just and intelligent decision. It is the duty of the 
members of the board, in their presentation of the case 
and in their arguments and statements before him, to fur- 
nish whatever information is necessary to an intelligent 
understanding of the question at issue. 

On the other hand, as against conciliation without ar- 
bitration, it is to be remembered that these boards are 
composed of the parties to the issue with the views — the 
prejudices, even — of their classes, and usually with pre- 
viously formed opinions. These must in some degree 
cloud the judgment and forbid impartial decisions. 
Further, elected as they are, as the representatives of a 
class, members are apt to forget, if indeed it always 
occurs to them, that they are not advocates solely, but 
judges, not elected to secure the demands of their con- 
stituents, but to ascertain what is fair and just, and get 
that. In many cases, where a member can lay aside his 
antecedent views and realize that though he represent one 
party to the issue, he acts for the whole trade, it will be 
found that he will not or dare not indicate his convic- 
tions by his vote. Now the arbitrator has no class preju- 
dice, no previously formed opinions, nor does he repre- 
sent either side, but both, and to a certain extent a third, 



AND THEIR SETTLEMENT. 43 

which is too often forgotten in these discussions — the pub- 
lic. He has assumed no positions from which he must 
recede ; he has no esprit du corps to maintain. The refer- 
ence to him relieves the members of the board of re- 
sponsibility, and gives much greater hopes for a righteous 
award than does the plan which compels a decision from 
the board itself, burdened and hampered with the condi- 
tions and obligations pointed out. It will even be found 
that in many cases, where the arbitrator is called in, if he 
is wise and prudent, his office will be little more than to 
promote calm discussion, and without prejudice or a 
sense of obligation, to inquire into the facts, and with the 
authority of his position and his impartiality, make them 
known to the board. 

It will also be found that the umpire performs a func- 
tion that is by no means unimportant in relieving the 
members of the board of the results of their own errors 
or finding a way out of positions of embarrassment. In 
a word, that he acts as a scape-goat, upon which may be 
laid many of the sins of the members of the board and 
those they represent. 

In addition to the division of these bodies based upon 
the distinction between arbitration and conciliation, there 
is still further classification, based upon their duration 
and the continuance of their operations. These boards 
or committees may be : 

I. Temporary ; that is, organized in an emergency, or 
in the face of an impending difficulty, possibly in the 
midst of a strike or lockout, and passing out of existence 
as soon as the special work they were organized to do 
has been accomplished or their efforts have failed. 

II. Permanent and Systematic j that is, having a con- 
tinuous existence and dealing constantly and systematic- 
ally with all questions as they arise between employers 



44 LABOR DIFFERENCES 

and employed in the works or trade or district which the 
board or committee represents. 

While temporary boards or committees may and do 
settle questions that are referred to them, it is evident 
that the chances are against them. When a labor war is 
imminent or in progress, there is usually no place for dis- 
cussion, and the decision of boards organized at such 
times is accepted by one party or both under duress, and 
is apt to be like the board itself, temporary. Many of 
the failures of arbitration and conciliation, and much of 
the discredit with which it is regarded, have- grown out of 
the incompetency and short-comings of these temporary 
or emergency boards. They ignore entirely what is re- 
garded by its advocates as the most essential feature of 
the system — prevention, not cure. It cannot be too often 
pointed out that the demand in connection with labor 
differences is not for a method that shall settle strikes, but 
for one that shall prevent labor differences, either by remov- 
ing their causes or by promptly settling them before they 
grow to disputes. It is the claim of the advocates of 
arbitration that permanent boards of arbitration and con- 
ciliation, with their systematic procedure, their stated 
meeting, and their friendly discussions, answer this de- 
mand, and that the temporary boards, however valuable 
they may be in a given case, do not. These permanent 
voluntary boards, recognizing the perfect equality of em- 
ployer and employed, and the right of each to an equal 
voice in the settlement of all questions, meeting at 
stated times, when no demand has been formulated, no 
positions assumed, no bitterness engendered, afford op- 
portunities for the rapid growth of that mutual confidence 
which must exist if any method of harmonizing differ- 
ences is to be effective. The great hindrance to the set- 
tlement of these questions is the unnecessarily antagonistic 



AND THEIR SETTLEMENT. 45 

position of employer and employed. If these can be got 
to shake hands in a friendly manner, to learn to have con- 
fidence in each other, to sit down at a table as equals and 
talk their differences over as they arise, and before they 
grow into disputes, the first step for a better understand- 
ing and for a settlement of these differences is taken. 

These permanent boards also furnish the opportunity, 
seldom present without them, for the workman to obtain 
a correct and measurably complete knowledge of the 
condition of trade, prices, demand, etc. The existence 
of that confidence and mutual respect before referred to 
makes the employer willing to give information to the em- 
ploye, in whose honesty of purpose he has learned to have 
confidence, which he would not impart under any other 
system, and which it is absolutely necessary he should 
know, in order to form an intelligent opinion as to the 
demands of the future upon him and upon the industry. 
And, on the other hand, the employer obtains a closer in- 
sight into the surroundings and needs of the employe. 

Permanent boards also acquire a fund of precedent 
and knowledge, and become an unquestioned repository 
of facts and the results of investigation that can be re- 
ferred to without the least shade of suspicion. The value 
of such information and of an exact record of the past is 
at times beyond compute. Every year of its existence 
adds to the usefulness of the board in this respect. 

Without considering here the general question of arbi- 
tration and conciliation as against other methods of set- 
tling labor disputes, but only the best form of these 
boards, it seems clear that the permanent boards of arbi- 
tration and conciliation are to be preferred to any tem- 
porary boards and to boards of conciliation alone. 



46 LABOR DIFFERENCES 



CHAPTER VI. 

LEGAL ARBITRATION AND CONCILIATION. 

In their origin and methods arbitration and concilia- 
tion are either — 

1 st, Legal, that is, established and operated under 
statute law, with its sanctions and also its powers for en- 
forcing awards or agreements : or 

2d, Voluntary, that is, established and operated by 
mutual agreement, the honor of the parties being the only 
surety for the acceptance of the awards or agreements. 

Under legal arbitration and conciliation submission of 
the questions may be either compulsory, that is, all or 
certain questions that arise between employers and em- 
ployed must be submitted to these boards or committees 
for their decision upon the application of either party ; or 
voluntary, that is, they may be so referred if both parties 
desire. 

The best, and indeed the only eminently successful ex- 
ample of legal arbitration and conciliation is to be found 
in the Conseils des Prud 'hommes, which have existed in 
France and Belgium since early in the present century. 
These are tribunals established by law at the great in- 
dustrial centres, for the purpose of settling labor differ- 
ences. The submission of questions may be either vol- 
untary or compulsory. The councils are invested with 
judicial power, but this power is not used until an attempt 
to reach an agreement has failed ; then the party declin- 
ing conciliation is compelled to accept arbitration, and 



AND THEIR SETTLEMENT. 47 

the award made can be enforced the same as that of any- 
other court of law. 

In the election of the , members of these conseils all 
classes connected with the industries represented in them, 
of which there may be several, take part, employers, man- 
agers, foremen, and workmen. The maire of the com- 
mune prepares the voting lists, the prefect acting as a re- 
turning officer. The conseils are made up of an equal 
number of employer and workingmen members, each 
class electing its own representatives, the president and 
vice-president being named by the government. The 
members hold office for three years. 

The authority of these councils extends to every con- 
ceivable question that can arise in the workshop not only 
between the workman and his employer, but between the 
workman and his apprentice or the foreman. There is 
but one question they cannot upon the application of 
either party consider — future rates of wages ; but even 
this can be done by mutual agreement. 

The conseil is divided into two bureaux or committees 
— the bureau general, composed of at least five members, 
meeting once a week, and the bureau particulier, consist- 
ing of one employer and one workman, who attend every 
day for two hours. A complaint is lodged by either 
party to the difference, and all disputants are " invited " 
in the first place to come before the bureau particulier in 
order to " explain " their differences. If no agreement is 
reached, nor the suggestions of the members of the 
bureau accepted, the parties are then formally summoned 
before the bureau ge"n£ral, which renders an authoritative 
decision, if the case be one falling within its jurisdiction. 
These decisions are binding, and can be enforced the 
same as those of any other court of law. 

The workings of the conseils for five years are as follows : 



4 8 



LABOR DIFFERENCES 







1874 


1875 


1876 


1877 


1878 


Number of Cornells con- 












stituted, 


112 


112 


115 


115 


115 


Number of Conseils 












which have been in 












session, 


98 


98 


IOI 


IOI 


IOI 


Bureau Particulier. 














r Concerning Wages, ) 
Defective work \ 


20,270 


21,083 


22,314 


21,368 
2,495 


22,358 
2,238 




Discharge of 














workmen, 


4,598 


4,618 


4,593 


4.733 


4,657 




Apprenticeship, 


1,722 


2,079 


1,962 


1,795 


1,525 




Various, 


4.654 


6,177 


5,905 


. 4,655 


5,082 


Total, 


31,244 


33,9°7 


34,774 


35,046 


35,86o 




r Withdrawn by parties 














before trial, 


6,316 


6,787 


8,167 


9,076 


10,192 




Adjusted by Bureau 














Particulier, 


18,319 


19,771 


19,607 


18,415 


18,334 




Reported for adjust- 














ment to Bureau 














General, 


6,450 


7,204 


6,925 


7,419 


7,210 




Carried forward to 














next year, 


159 


145 


75 


136 


124 


Bureau Gindral. 1 














' Remaining from pre- 














ceding year, 


129 


147 


142 


152 


113 




Brought in during the 














year, 


6,450 


7,204 


6,925 


7,419 


7,210 




Withdrawn by parties 












. 


before trial, 


4,086 


4,656 


4,293 


4,710 


4,410 


Definitively adjusted 














by the Bureau Ge- 














neral, 


1,853 


1,885 


2,093 


2,220 


2,292 




Against which appeal 














could be brought, 


500 


665 


541 


507 


494 




Adjourned, 


140 


145 


140 


134 


137 


Number of cases 












against which an 












appeal was brought 












before Tribunals of 












Commerce, 


135 


104 


9i 


131 


100 


Of these : 












Were confirmed, 


71 


57 


58 


59 


59 


Annulled, 


43 


29 


21 


43 


23 




Amicably settled, 


1 21 


18 


12 


29 


18 



1 The cases brought before the General 
could not be settled by the Special Bureau. 



Bureau are those which 



AND THEIR SETTLEMENT. 49 

These conseils have been of incalculable benefit to 
French industry, and their constitution and methods 
seem well adapted to the conditions of industrial life in 
that country. The preceeding table gives some idea of 
the character and disposal of the questions brought be- 
fore them. 

From this table it will be noted that in 1878, of the 
35,860 cases brought before these conseils, 22,358, or 62 per 
cent., were relative to wages ; 2,238, or 6 per cent., to de- 
fective work ; 4,657, or 13 per cent., to discharge of work- 
men ; 1,525, or 4 per cent., to apprenticeship, and 5,082, 
or 14 per cent., are not classified. Of the total number, 
10,192, or 28 per cent., were withdrawn before trial ; 
18,334, or 51 per cent., settled by conciliation and but 
7,210, or 20 per cent., were referred to the bureau general. 
Of the cases before this bureau, the arbitration board, but 
38J per cent, were brought to trial, and of these but 18 
per cent, were appealed. Of the cases appealed, only 
about one fourth were annulled. 

Outside of France and Belgium, what I have termed 
"legal arbitration and conciliation," has been but little 
used. In England the Elizabethan labor statutes, which 
were in many of their features but codifications of the 
rules and regulations of the craft-guilds, provided for 
the assessment of wages in certain trades and the com- 
pulsory settlement of disputes between "masters and 
apprentices" by the magistrates. During succeeding 
reigns these statutes were modified and enlarged, new 
industries were included in their scope, and, in time, the 
power of arbitrating lodged with the magistrates was 
taken away, and the idea of arbitration by chosen or 
appointed referees incorporated in law. In 1824, all 
acts, so far as they related to the settling of labor dis- 
putes, were consolidated and replaced by that of 5 Geo. 



50 LABOR DIFFERENCES 

IV., Cap. 96, entitled : " An act to consolidate and 
amend the laws relative to the arbitration of disputes 
between masters and workmen." This was patterned 
after the French law establishing Conseils des Prud'- 
hommes. It provides, as does that, for the compulsory 
submission to arbitration, upon the request of either 
party to the same, of disputes arising between employ- 
ers and employed in certain trades and upon certain sub- 
jects. Future rates of wages could only be established 
by mutual consent. This act is still in force, but has 
rarely, if ever, been used. It is the last one in which the 
justice of the peace appears as a labor or wages arbitrator. 

Shortly after the passage of this act, voluntary boards 
of arbitration and conciliation were introduced into some 
of the industries of England. In addition to the formal 
arbitration of existing disputes contemplated in the act of 
1824, these boards considered and fixed future rates of 
wages and also provided for conciliation committees, 
whose province was to adjust differencs between em- 
ployers and employed by mutual good offices without a 
formal hearing and award. In 1867 these boards had 
become so numerous and successful, that an attempt 
was made to give them a legal basis, if they so chose, 
by the passage of the 30 and 31 Vict., Cap. 105, com- 
monly called Lord St. Leonard's Act. 

In both of these acts, special care is taken to provide 
against the fixing of future rates of wages — one of the 
most prolific sources of dispute. This was a serious de- 
fect. Accordingly, in 1872, an act was passed, the uses 
of which, briefly stated, are three, viz. : 1. To provide 
the most simple machinery for a binding submission to 
arbitration and for the proceedings therein. 2. To ex- 
tend facilities for arbitration to questions of wages, hours, 
and other conditions of labor, and also to all the numer- 



AND THEIR SETTLEMENT. 5 I 

Otis and important matters which may otherwise have to 
be determined by justices under the provisions of the 
master and servant act of 1867. 3. To provide for sub- 
mission to arbitration of future disputes by anticipation 
without waiting until the time when a dispute has act- 
ually arisen and the parties are too much excited to 
agree upon arbitrators. These acts have been of but 
little practical value. In their best features the recent 
ones have followed, not preceded, the voluntary practice 
of arbitration and conciliation, and they have only sought 
to give the forms and sanctions of law to a practice that 
was successfully in force without such forms and sanc- 
tions. 

In several of the United States laws have been enacted 
providing for the formation in certain industries of boards 
of arbitration and conciliation of a quasi-legal character. 
These boards are really voluntary tribunals mutually 
chosen, but organized and sanctioned by law, and with 
the power of the courts of law to enforce their decisions. 
The Pennsylvania law, which may be taken as a type, 
provides that the presiding judges of the Court of Com- 
mon Pleas shall issue, upon the joint petition or agree- 
ment of employes and employers, licenses for the estab- 
lishment of trade tribunals within their respective judicial 
districts, which shall have the settlement of such disputes 
between employers and employed in the iron, steel, glass, 
textile fabrics and coal trades as may be referred to them. 
The petition must be signed by at least fifty workmen 
and five or more employers. If the petition is presented 
during a strike, or when one is imminent, it must repre- 
sent the will of the majority. The petition must set forth, 
among other things, the number of the members of the 
tribunal, which cannot be less than two of each class, and 
their names, an equal number representing each side, 



52 LABOR DIFFERENCES 

each side selecting its own representatives, and. also the 
name of an umpire mutually chosen. The board first at- 
tempts to come to agreement without the services of the 
umpire, he being called in only after a disagreement of 
the tribunal or a failure during three meetings held and 
full discussion had, to reach an agreement. The award 
of the arbritrator or umpire is final and conclusive upon 
such matters only as are submitted to him in writing, 
signed by all the members of the tribunal, or by the 
parties submitting the same ; but upon questions af- 
fecting the price of labor the decision is in no 
case binding upon either party, except as they may 
acquiesce or agree therein after such award. The umpire 
is a sworn officer, and has the right to administer oaths, 
sign subpoenas, and orders, compel the attendance of wit- 
nesses, etc. Attorneys-at-law or other agents of one side 
or the other are not permitted to appear or take part in 
any of the proceedings of the tribunal, or before the 
umpire, but the same is as far as possible voluntary and 
upon examination of proofs and witnesses by the tribunal 
itself and the umpire. When the umpire is acting, he 
presides, and his determination upon all questions of evi- 
dence or otherwise, in conducting the inquiries then 
pending, is final. The members of the tribunal receive 
no compensation for their services, their expenses, how- 
ever, being paid. When the umpire makes an award, that 
award may be submitted to the judge of the court under 
whose authority the tribunal was instituted, and if he 
approves the finding he endorses the approval thereon, 
and the same is entered on the records of his court, and 
when so entered it is final and conclusive, and the proper 
court may, on motion of any one interested, enter judg- 
ment thereon, and when the award is for a specific sum 
of money, may issue final and other process to enforce 
the same. 



AND THEIR SETTLEMENT. 53 

It will be seen from the above condensed statement of 
this act that it is patterned very much after the Conseils 
des Pructhommes of France and Belgium. In the French 
conseils the presiding officer is appointed by the state, and 
the tribunals are orgained at the requests of the Cham- 
bers of Commerce. In Pennsylvania the tribunals are 
organized at the request of the employers and employed, 
who also name the umpire. Another difference is that 
either party can hale the other before the tribunal in 
France, and compel a settlement there, which cannot be 
done in Pennsylvania. With these exceptions the tri- 
bunals are precisely similar. Either can take cognizance 
of any question submitted to it. In neither can ques- 
tions relating to future rates of wages be considered with- 
out the consent of the parties, but in the French conseil, 
when the parties have once agreed to submit the question 
of the future rates of wages to the decision of the conseil, 
then the decision is binding on both. Decisions given by 
the umpire can be made matters of record in the courts, 
judgment entered and the judgment enforced the same as 
any other judgment of these courts. 

Boards have been formed under these laws, but they 
have had a brief existence. With hardly an exception, 
the questions submitted to them have been the settle- 
ment of future rates of wages. In a brief time a deci- 
sion has been rendered that has not met the views of 
some of the parties to the arbitration, and, as there has 
been no power to compel its acceptance, and as the 
sense of honor of the parties did not seem keen enough 
to lead them to keep their agreements, the award has 
been rejected and the board abandoned. 

And yet these laws, while they are of little or no use, so 
far as relates to power to enforce the awards, are still of 
great value. They furnish the opportunity for the 



54 LABOR DIFFERENCES 

formation of these boards, which, without them, is 
often wanting, and lay down certain general principles 
upon which they must be organized and conducted, 
and, so far, avoid difficulty at the outset. They also 
give powers to the umpire that at times may be impor- 
tant. They, moreover, assist in enforcing awards. There 
must be some power to compel acceptance of the deci- 
sions of these tribunals or the umpire. Often this power 
grows out of the relations employers or employed hold to 
each other, and it is frequently not in the least a physical 
one. Of such a character is that afforded by these laws. 
The moral force that attaches to the word law is quite 
effective at times, and it is possible that the best form of 
a board of arbitration is the voluntary one, organized un- 
der such laws as that of Pennsylvania, with strong con- 
servative organizations of both employers and employed 
to aid in enforcing awards. 



AND THEIR SETTLEMENT. 55 



CHAPTER VII. 

VOLUNTARY ARBITRATION AND CONCILIATION. 

The second method of arbitration and conciliation is 
the voluntary one ; the boards or committees formed for 
its application being in their origin and methods purely 
voluntary bodies, with no taint of law and no powers of 
distress or commitment. These boards have no legal 
existence, though they are not unlawful. There is little 
form at any stage of the proceedings. In them courts 
and magistrates have no place. There is no compulsory 
submission of disputes, no forced attendance of witnesses, 
nor is there any power, except a man's sense of honor, 
public opinion, and the aggregate honor of such bodies 
as trades-unions and employers' associations, to compel 
the acceptance and to give force to the awards. 

In their general character and methods, these volun- 
tary boards or committees recognize the distinctions al- 
ready pointed out between arbitration and conciliation, 
and to a much greater extent than the legal form, that 
difference growing out of their duration and continuity 
of action. There is this difference to be noted between 
conciliation in legal and in voluntary boards, however. 
Legal conciliation is always associated with arbitration, 
and, in view of the constitution of legal boards and the 
source of their power, necessarily so. Conciliation in 
voluntary boards may or may not contemplate arbitration. 
In all voluntary boards, even with arbitration, however, 
the measure of the power of the board or the umpire is 
always the voluntary consent of the parties to the issue, 



56 LABOR DIFFERENCES 

As has been stated, legal arbitration and conciliation 
have practically no existence either in England or the 
United States. In England the parties to labor differ- 
ences persistently decline to avail themselves of the pro- 
visions of the several arbitration acts, while the quasi- 
legal boards in this country are legal in name rather 
than in fact. Whatever of success has been attained in 
these two countries in applying this principle to labor 
differences has been chiefly through voluntary boards or 
committees, the two great English speaking nations pre- 
senting in this respect a contrast to the two French states, 
France and Belgium, in which legal arbitration and con- 
ciliation prevail. 

A moment's consideration of the causes of the differ- 
ences which arbitration and conciliation seek to remove, 
and a clear recognition of the real authority in which 
power concerning these differences is lodged, and to 
which ultimately an appeal must lie, is convincing that 
this voluntary form is the only one that gives promise of 
success in dealing with those questions that most fre- 
quently lead to industrial warfare. 

As was pointed out in the first chapter, labor differ- 
ences arise concerning both past and future contracts, 
and also grow out of " matters of sentiment." From 
their very nature it is evident that it is only a very limited 
range of difficulties, chiefly those involving the terms and 
construction of contracts under which work has already 
been done, that legal or compulsory arbitration and con- 
ciliation, relying as it does upon the state to give effect 
to its decisions, can deal with any degree of efficiency. 
It is natural and proper that the parties to such differ- 
ences, involving as they do work done and money earned, 
that is, actual property, should be compelled, if necessary, 
to submit their differences to a competent tribunal, and 



AND THEIR SETTLEMENT. $J 

when that tribunal has honestly and carefully reached a 
decision, that the state by all its agencies should give it 
effect. In dealing with such questions these boards or 
committees are but courts of law unfettered by their 
forms or ceremonies. 

But it is not concerning past contracts or work done 
that differences and disputes most frequently arise, but 
as regards the future, 1 and here legal arbitration and 
conciliation is confessedly powerless. Every law pro- 
viding for legal arbitration formally recognizes its limita- 
tions, and provides that the boards or conseils organized 
under them shall not deal with future rates of wages un- 
less by mutual consent. Even then the awards cannot be 
enforced unless this consent is renewed after the finding. 
There is no power in the state to compel the performance 
of work under the terms of an award without recourse to 
practical confiscation and absolute slavery. Law cannot 
force men to work at rates nor upon terms to which they 
will not agree, nor can it compel an employer to operate 
his works and furnish employment. In a word, there is 
no power outside the parties themselves that can give 
effect to a decision as to a future contract or that can 
harmonize quarrels over matters of sentiment. It is with 
them that power is lodged, and to them appeal must ulti- 
mately lie. Within the realm of labor to a degree un- 
known elsewhere, government exists only by the consent 
of the governed. 

1 Of the 813 strikes and lockouts reported upon by me in the United 
States Census Report, fully 90 per cent, of those for which causes 
were ascertained, which included 93! per cent, of all, related to the 
future. All but one of the 582 relating to rates of wages were de- 
mands for advances or against reductions, 504 of the former and 77 
of the latter. All but 7 of the 35 regarding payment of wages related 
to future methods or time. All under hours of labor concerned the 
future, as did most of those regarding methods of work. 



58 LABOR DIFFERENCES 

It is in the complete recognition of this fact at all stages 
of its proceedings, the submission, discussion, award, and 
enforcement, that is the strength and justification of the 
system of voluntary arbitration and conciliation. It is 
because it furnishes a method and the only one for secur- 
ing that consent without which no method of harmonizing 
the relations and settling or preventing the differences 
between employer and employed can be of any value, 
that it must ultimately prevail. It is the government of 
reason, rinding its sanctions in the freely given consent, 
their loyalty to themselves, of the subjects of its reign. 



AND THEIR SETTLEMENT. 59 



CHAPTER VIII. 

SOME EXAMPLES OF VOLUNTARY ARBITRATION AND 
CONCILIATION. 

It is impossible in the limits of this treatise to detail 
the history, constitution, and methods of these voluntary 
committees or boards. Indeed, the system is so elastic 
and admits of being so easily modified to adapt it to the 
varying phases that different industries exhibit, as to ren- 
der it impossible to give more than typical examples. 
For full details those interested are referred to the 
writer's report on " Industrial Arbitration and Concilia- 
tion in England," made to the Governor of Pennsylvania 
in 1878, and a second report on " Arbitration and Concili- 
ation in New York, Pennsylvania, and Ohio," made to the 
Massachusetts Bureau of Labor Statistics in 1880. Mr. 
Henry Crompton's little work on " Industrial Concilia- 
tion " (London, 1876) ; Sir Rupert Kettle's " Strikes and 
Arbitration " (London, 1866) ; and the report of the Social 
Science Association (English) for i860 all give valuable 
information as to the history of arbitration and con- 
ciliation. For information as to the Conseils des PruoT- 
hommes, there are several little manuals. One of the best 
is the " Code Praciique des Prud' homrnes" par Th. Sar- 
razin. (Paris : Marchal, Billard et Cie.) 

While space forbids full details, a brief sketch of some 
of the more notable instances of the successful and long- 
continued practice of arbitration and conciliation, will 
add to the completeness of this discussion. The boards 



60 LABOR DIFFERENCES 

and committees in the Hosiery and Glove Trade of 
Nottingham (Eng.), in the Iron Trade of the North of 
England, in the Coal Trade of Durham (Eng.), and in 
the Iron Trade of Pittsburgh, Pa., are among the most 
notable examples of arbitration and conciliation. The 
industries represented in these differ widely in character, 
while the boards or committees in their methods and or- 
ganization present some marked differences as to details. 

The oldest as well as one of the most successful boards 
of arbitration and conciliation in England is in the hos- 
iery and glove trade, of which Nottingham is the centre. 
This board has the honor of being the first systematic 
voluntary board. In view of the previous history of 
this trade and the difficulties attending the adjustment, 
not only of wages, but of various perplexing details, its 
success is a most complete vindication of the system. 

Prior to i860, when the board was established, the re- 
lations of employers and employed in this trade were as 
ugly as could well be imagined. From 17 10 to 1820 
there is recorded a frightful list of murders, riots, arsons, 
and machine-breaking, all arising out of industrial differ- 
ences. An act was passed by Parliament early in the 
century punishing machine-breaking with death, and in 
1 816 six persons suffered this penalty. In the remaining 
forty years of the century and a half from 17 10, while the 
worst features of this industrial strife nearly or quite dis- 
appeared, the relations were in no wise improved, though 
the strife assumed a different form. Suspicion, distrust, 
hatred, were the sentiments cherished towards the manu- 
facturers by the workmen, and arrogance, oppression, and 
an equally strong hatred were returned. War, or at least 
an ill-kept armistice, was the condition of the hostile 
camps. Strikes and lockouts were constantly occurring, 
and no judicious, honest effort was made to end them. 



AND THEIR SETTLEMENT. 6 1 

In i860 there were three strikes in one of the three 
branches into which the hosiery trade is divided, one 
lasting eleven weeks. It was during this strike that the 
Board of Arbitration and Conciliation was formed. 
Though the strike was confined to one branch, it was 
soon discovered that it was supported by the workingmen 
in the other branches, and, in what they considered self- 
defence, it was proposed by the manufacturers to lock 
out the entire body of workingmen in all branches. 
Some of the manufacturers, Mr. A. J. Mundella among 
them, shrank from the misery and suffering, and perhaps 
crime, that would be the result, and having heard of the 
Conseils des Prud'hommes, suggested what is now called 
arbitration. Committees of manufacturers and workmen 
met, and looked suspiciously at each other, while the 
manufacturers charged their fellow-manufacturers who 
were striving to form the board with " degrading and hu- 
miliating them " They persisted, and a board was formed, 
and from that day to this, twenty-six years, there has not 
been a general strike in the trade, 

The rules adopted were very simple, and have worked 
so well in most particulars, that they have hardly been 
amended since the day they were made. The object of 
the board is declared to be to arbitrate on any question 
of wages that may be referred to it, and to endeavor by 
conciliatory means to put an end to any disputes that 
may arise. The board consists of twenty-two members, 
half operatives and half manufacturers, elected for one 
year, each class electing its own representatives. The 
delegates have full powers, and the decisions of the board 
are considered binding upon all. There is provision for 
a committee of inquiry, to whom all differences must be 
referred before the board will act upon them. This com- 
mittee has no power to make an award, acting only as 



62 LABOR DIFFERENCES 

conciliators. A month's notice is to be given to the sec- 
retaries before any change in the rates of wages will be 
considered. Regular meetings are held quarterly. The 
chairman in the original constitution of the board has a 
vote, and a casting vote as well, in case of tie. This was 
one of the weak points in the organization, and as the 
chairman was an employer, trouble resulted. A referee 
is now called in case of a failure to agree. 

The proceedings under these rules are very simple. 
When any difference arises between the employers and 
employed the secretaries endeavor to arrange it. In the 
event of their failure it is brought before the committee 
of inquiry, who try to settle it ; and it being unable, it is 
then brought before the board. One of the invariable 
conditions of any arbitration is that work shall be con- 
tinued pending the trial of the case ; that is, that there 
shall be neither strike nor lockout. The proceedings 
before the board are very informal. The members sit 
around a table, workingmen and employers interspersed. 
The discussion is without ceremony, and the difference is 
settled by endeavoring to arrive at the best arrangement 
possible under the circumstances. If no agreement can 
be reached the umpire is called upon. 

As the articles made in this trade are exceedingly 
numerous and varied, and constantly changing in style, it 
is evident that questions as to wages, which are all by the 
piece, must arise almost daily. Since its formation all of 
these intricate questions have been referred to the board 
and settled by it. The board has never met without set- 
tling at least half a dozen questions. 

The benefits this board has conferred on the hosiery 
and glove trade are incalculable. A most friendly feeling 
has taken the place of hostility, and confidence and mu- 
tual respect exist where formerly all was suspicion and 



AND THEIR SETTLEMENT. 63 

hatred. This was not the result of a day, nor was it ac- 
complished without occasional lapses to the old state of 
things. The strifes of a century and a half are not so 
soon forgotten ; but troubles in the board have been so 
infrequent and unimportant, that I am justified in saying 
that it is a complete success. Strikes and lockouts are 
unknown ; contact has developed respect. The changed 
relations of employer and employed have been recog- 
nized ; they have met about the same table as equals ; 
and out of this has grown a condition of affairs that will 
make it impossible for the old condition to return. 

A large part of the credit of the success of this board, 
and of the change in the relations of the two classes, is 
due to the provision for regular meetings of the board. 
I do not hesitate to say that this is the most valuable fea- 
ture of these boards. The great curse of industry and 
the fruitful cause of difficulty is a foolish obstinacy and a 
false pride. This arises in many cases from a want of 
knowledge and a lack of common courtesy in matters 
concerning both capital and labor, and in which both have 
an equal interest. This quarterly coming face to face, 
this meeting as equals, and discussing subjects of com- 
mon interest as sensible men seeking for the facts and in- 
clined to moderation and concession if need be, have had 
a marvellous effect in removing this pride and obstinacy 
and bringing about that respect and courtesy that must be 
at the basis of all friendly negotiations between capital 
and labor. These meetings have also given the men a 
knowledge of the conditions of trade and its necessities, 
which they could not get in any other way, and, from this 
knowledge, they have been led to moderation in demand 
or willingness to concede reductions that otherwise they 
would not have possessed. If the arbitration features 
were wholly removed from these boards, and they only 



64 LABOR DIFFERENCES 

retained this feature of quarterly meetings of recognized 
representatives of trades-unions and of manufacturers' 
associations, their adoption generally in this country 
would be productive of incalculable benefit. 

The manufactured iron trade of the North of England 
differs widely from that just described. It is a recent trade, 
beginning to assume importance in i860, just as the board 
in the hosiery trade was being formed. For ten years its 
growth was marvellous, and at the end of this time it 
rivalled many and surpasssed most of the oldest centres 
of English iron manufacture. This wonderful increase at 
a time when other districts were growing created a 
demand for labor that could not be met from the ranks 
of those already skilled in the various processes of iron 
manufacture, and workmen were drawn from all classes 
and grades of laborers. The result was a most heteroge- 
neous collection of workmen. There were no ties of 
friendship or locality. There were none of those attach- 
ments that long companionship causes men to form among 
themselves and for their employers, and even for the 
very tools with which they work. The result of this state 
of affairs can be easily imagined. It was endless dis- 
putes ; strikes were of frequent occurrence. In 1&65-66, 
there were both a lockout and a strike, the latter lasting 
four months ; and in the end nothing was settled except 
that capital could hold out longer than labor. " Between 
that time and the winter of i868- , 6q, repeated reduc- 
tions in wages were enforced and gave rise to feelings of 
resentment, which rendered it more than probable that 
any considerable increase in the demand for iron would 
be the signal for peremptory demands on the part of the 
workmen." Trade began to improve in 1869 and the de- 
mand came. To avert the trouble, arbitration was 
suggested ; and on March 22, 1869, the board was formed, 



AND THEIR SETTLEMENT. 



65 



and has continued in successful operation until the 
present time, and, for all these years has settled the wages 
and other industrial questions in this trade. This board 
consists of two representatives from each works joining it, 
one chosen by the owners of each works, the other by the 
operatives. It chooses from among its members a stand- 
ing committee, to whom all differences are in the first in- 
stance referred, and whose recommendations in minor 
matters are generally accepted. This committee, how- 
ever, has no power to make an award except by mutual 
agreement of the parties to the dispute. All questions 
not settled by it are brought before the board as soon 
as possible, and in case of a failure to reach an agreement 
are referred to an umpire. The committee meets when 
there is any business ; the board, twice a year, or oftener 
if necessary. The expenses are paid equally by employers 
and employed. 

There is a provision in the rules of this board for obtain- 
ing statements at frequent intervals as to the actual selling 
prices of the iron made in the district, the books of the 
manufacturers belonging to the board being inspected by 
sworn accountants. The last report of the accountant 
was as follows : 
Sales During the Two Months Ending October 31, 1885. 



Description, 


Weight invoicec 
Tons. Cwts. Qrs. 


Lbs. 


Percentage 
of total. 


Average net 

selling price per 

ton. 


Rails, 
Plates," 
Bars, 
Angles, 


656 3 

33,002 10 

18,351 7 

18.351 7 

9.009 14 


I 

3 
1 

1 

3 


12 
12 
25 
25 

7 


1.07 

54-09 
30.07 

14-77 


£ s. d. 

4 12 2.34 

4 16 2.83 

5 7.82 
4 13 8.48 


Total, 


61,020 4 


2 





100.00 


4 17 1.76 



This information is of great value. It gives the work- 
ing man what is so difficult to secure, the actual selling 
price of the articles made. 



66 



LABOR DIFFERENCES 



The balance sheet of this board is of considerable 
interest as showing the cost of arbitration. In a con- 
densed form for the six months ending June 30, 1885, ** 
is as follows, omitting shillings and pence : 

Total receipts ^980 

Total expenditure 628 

Paid operatives (attendance, lost time, 
witnesses, railway fares) . 

Paid employers (attendance, witnesses, 
railway fares) .... 

Secretaries' salaries and travelling ex- 
penses 

Accountant's fee • 

Printing and stationery 

Office rent and rooms for meeting 

Office expense .... 

Reporting 



£162 

109 

162 

150 

19 

16 

9 

1 



It is in the coal industry that arbitration has been most 
frequently tried in this country, and with but little more 
than temporary success. Indeed, it has come to be be- 
lieved that in an industry with so few classes of occupa- 
tion, and in which an award must affect nearly, if not 
quite, all employes, arbitration could have but little suc- 
cess. This is disproved by the history of arbitration in 
the Durham, England, coal trade. 

The Durham with the Northumberland mines form 
what is known as the Great Northern Coal Field. The 
tonnage of Durham and the number of persons employed 
are in excess of any other of the British coal fields. In 
South Durham alone, 55,969 persons were employed 
about the mines in 1882, and 21,780,808 tons of coal 
raised, while North Durham and Northumberland would 
increase these figures to 98,866 persons, and 36,299,597 



AND THEIR SETTLEMENT. 6 J 

tons out of a total for the United Kingdom, of 503,987 
persons, and 156,499,977 tons. 

For fifteen years the rates of wages in this district, as 
well as all minor differences, have been settled by mutual 
agreement or arbitration, and peace, if not always con- 
tentment, has existed. The negotiations as to wages and 
all disputed questions in most of these years have been 
carried on by the executives of the two associations, the 
Durham Miners' Association for the workmen, and the 
Durham Coal Owners' Association for the operators, the 
former reinforced since 1879 by the Enginemen's, the 
Mechanics', and the Cokemen's associations. Both of the 
former are strong organizations, each commanding the en- 
tire confidence and support of the body which it represents. 
The Miners' Union, which includes nearly all classes of 
labor about the mines, is very strong, well officered, 
and directed by men of undoubted ability and prudence, 
and able to compel, not by force, but by moral means, the 
unhesitating acceptance by the vast army of coal workers 
in Durham of any agreement entered into by its repre- 
sentatives with the representatives of the Owners' Asso- 
ciation, or any award given by the arbitrators or umpire. 

These two associations were organized about 187 1. 
From that date up to 1876, all advances or reductions 
were arranged at regular intervals, either by mutual agree- 
ment or by arbitration, while smaller or local differences 
were adjusted by a joint committee of the two associa- 
tions. In September, 1876, it was suggested, in order to 
save trouble and annoyance of repeated arbitrations, that 
a sliding scale, based upon the selling price of the coal 
at the pit's mouth, be agreed upon. Such a scale was ar- 
ranged March 14, 1877, ~and put in force the following 
April. 

This scale was to be in force by its terms for two 



68 LABOR DIFFERENCES 

years. Before it expired the selling price of coal fell 
much below the minimum and the scale was subjected to 
a severe strain. When it ended by its limitation the 
operators asked a reduction below the minimum. The 
necessity for such a reduction was conceded by the men, 
but no agreement could be reached as to the amount, and 
a short lockout ensued, but the question was soon settled 
by concessions and arbitration, and a reduction given. 
Other scales have since been adopted. 

During the fifteen years that these harmonious relations 
have existed, in addition to the general arbitration and 
the adoption of these several sliding scales, hundreds of 
local questions have been settled peaceably, and it is the 
boast of both parties that they have always "acted in 
good faith, and with an honest desire to have every 
mutual settlement honestly confirmed." 

In the three examples above given arbitration has taken 
the form of permanent, systematic Boards of Arbitration 
and Conciliation. In the one yet to be discussed, the 
iron trade at Pittsburgh, there have been only conference 
committees, or the form has been temporary committees 
of conciliation without any power of arbitration. 

The first of these conferences, composed of representa- 
tive men from each side — the employes representing the 
"United Sons of Vulcan," a trade-union — was held in 
Pittsburgh in 1865, and resulted in the formation of a 
sliding scale of wages to be paid for boiling iron. This 
is one of the earliest sliding scales ever agreed upon. 
At first only the wages for boiling iron were the subjects 
of these conferences, but shortly after 1870 workmen in 
the iron trade other than boilers formed associations, 
and, in conferences with the manufacturers agreed upon 
scales. In 1876 all of these unions were amalgamated 
into one, which has since appointed the members of these 



AND THEIR SETTLEMENT. 69 

committees representing the employes. The representa- 
tives of the employers were at first appointed at meetings 
of the employers called for that purpose, but latterly 
there has been a Manufacturers' Association, which has 
acted in this respect. 

At first the agreements were in force until formal notice 
— generally sixty days' notice — had been given to abro- 
gate them. Latterly the agreements are from year to 
year. 

This system has many defects, while it has, at the same 
time, its advantages. It has by no means prevented 
strikes and lockouts. The employe" members of the 
committee have, until the past year, usually been no 
more than a committee to present to the manufacturers 
the rates of wages the Union had decided upon — having 
no power to accept any terms but those which they had been 
instructed to accept. At the same time, it is fair to say 
that the information gained at these conferences has often 
led to modification of demands. These agreements, once 
reached, have in every instance been faithfully kept ; 
the terms have been strictly adhered to, and, if any 
change in the terms of the agreement has been desired, 
the agreement has always been abrogated in the way 
named in its terms. A possible exception to this state- 
ment is in cases where certain classes of employes work- 
ing under these scales have struck, though there was no 
question as to their wages, to assist in enforcing the de- 
mand of some other class of labor, — as when the rollers 
would strike to assist the puddlers to obtain a scale ; but 
even in such cases it should be stated that the workmen 
do not regard it as in any fair sense a violation of their 
agreement. 



fO LABOR DIFFERENCES 



CHAPTER IX. 

SOME OBJECTIONS TO ARBITRATION. 

There are certain objections both to the system and to 
the practice of arbitration that it is necessary to notice. 
Some of these have already been considered in discussing 
the relative merits of the different forms of arbitration 
and conciliation. There are others that are urged not 
against any particular form of the system but against the 
system itself and its results. It will appear that many of 
these objections to arbitration grow out of the adherence 
to certain economic theories, the soundness and applica- 
bility of which to labor differences have already been 
discussed. In discussing these objections it will be 
necessary to notice incidentally some of the benefits of 
the system. 

One objection to arbitration grows out of the assump- 
tion that the right to decide questions that arise between 
employer and employed rests with the employer alone. 
When a decision is given labor's only choice is to accept 
the result or go elsewhere. An employer holding this 
belief naturally refuses to recognize a right of interfer- 
ence on the part of any employe or any committee or 
board or arbitrator, and treats the suggestion of a con- 
ference as an impertinence. Stripped of verbiage, this is 
an assertion that the right to dictate the terms upon which 
that labor, the wages of which are necessary to the very 
existence of the laborer, shall be performed, rests with the 
employer. It is a monstrous doctrine. It means slavery 



AND THEIR SETTLEMENT. yi 

or starvation, and it is a theory that society for its own 
safety should not tolerate for a moment. Labor is no 
longer in a state of industrial subjection, nor does it ac- 
knowledge even in theory that its wages come out of the 
employer's pocket. The employe" on the one hand asserts 
both his industrial independence and his equality with 
his employer, and demands and will have, as his right, 
not as a favor, a voice and an equal power in the decision 
of the questions that affect his interests and his relations 
to his employer, his work, and his product. To attempt 
to abridge this right or to deprive him of it will prove 
ultimately a costly and abortive experiment. He insists 
further that as wages are paid out of product in which 
his labor as well as his employer's skill and the money of 
the capitalist are found, it is as truly his right as it is that 
of the employer to have a part not only in the distribution 
of that product, but in the decision as to the basis on 
which it shall be distributed. Capital is under no neces- 
sity to invest its accumulations in industries that shall 
employ labor, nor is an individual employer compelled 
to become an entrepreneur , but when capital invests and 
the employer undertakes and labor is brought in that 
production may result, then capital and the employer, 
equally with labor, must submit to the conditions into 
which they have voluntarily entered. The workman is a 
partner in production ; his labor under the present 
methods is one of the three indispensable factors in pro- 
duction, and as such is entitled to participate in the 
decision of questions that affect his interests, and to which 
he is a party. If this is true the objection urged is not 
valid. The decision of these questions is not with the 
employer alone. 

Probably the most strongly urged objection to arbitra- 
tion and conciliation is that it seeks to settle the terms 



72 LABOR DIFFERENCES 

upon which work shall be done in the future. These, it 
is held, cannot, in the very nature of things, be subjects 
of agreement or award, as they depend on the course of 
future events, which is unknown. A decision, therefore, 
may not only be erroneous and injurious, but it may also 
interfere with what the economists of a certain school 
call industrial freedom, by which is meant an impulse to 
seek surely and swiftly the best markets. 

So far as this objection is based on the assumed 
authority and sufficiency of competition, it has already 
been discussed. There is apparent force, however, in 
that part of it which asserts the liability to error arising 
from want of knowledge of the future. The elements 
necessary to accurate determination are wanting, and it is 
possible that the judgment of the board or umpire may 
be at fault and errors may occur, but are errors more 
likely to happen in a system which brings reason and de- 
liberation to the estimation of probabilities than in one 
that takes passion or greed as its prophet ? For it is to 
be remembered that these questions as to the future must 
be answered. They are ever present. They will not 
down. They cannot be ignored. They must be met, 
and whatever view may be taken of their legitimacy, they 
must be answered. Labor demands to know the terms 
upon which it is to toil before it will work. An answer 
to its demand being imperative, is there any method that 
has yet been suggested that promises to answer as justly 
or correctly as arbitration ? 

But it is by no means clear that the future is not a 
proper subject of agreement or award. There are many 
questions relating to methods of work and administration 
that most certainly are. Endless confusion and innumer- 
able conflicts would result were not these details subjects 
of agreement beforehand. Further, the fixing of future 



AND THEIR SETTLEMENT. 73 

rates of wages is not only not theoretically unsound, but 
it is in accordance with the most obvious business prac- 
tice and prudence. It is absolutely impossible in the 
present organization of industry that work should go on 
one moment without an agreement as to what wages shall 
be. This is too obvious to need discussion, and whether 
that agreement is for a year or for a day it is fixing future 
rates of wages. There may be a question as to the 
proper duration of the agreement, that is, how long the 
rates shall obtain, but there can be no question as to the 
necessity of some agreement. Further, such fixing of 
future rates of wages is exactly analogous to the very 
common and commendable practice of buying and selling 
goods for future delivery. Its advantages, in view of 
modern commercial methods, are beyond question. A 
rate of wages established for a fixed period justifies an 
employer in entering upon contracts for the purchase of 
materials and the delivery of goods with a certainty that 
cannot exist when these rates may be advanced to- 
morrow. As has been stated, the length of time an 
agreed rate of wages shall be in force is a subject for 
agreement the same as the rate itself, but even here the 
difficulties and injuries arising from frequent adjustments 
may be largely overcome by the adoption of sliding 
scales. Indeed these sliding scales remove many of the 
objections to fixing future rates of wages. Once agreed 
upon, under their operation, wages conform themselves to 
selling price, to the course of events, without confusion, 
without friction. It may also be said in passing that they 
are a practical recognition of the true theory of wages. 

Another objection to arbitration is, that the awards and 
decisions are usually compromises. By this is meant that 
neither party to the submission gets what it asks, or there 
is what is termed " splitting the difference." Even if this 



74 LABOR DIFFERENCES 

were true, it would not be surprising. It requires but 
little experience with labor differences to learn that it is 
by no means uncommon for both sides to demand more 
than they expect to get for the very purpose of having 
something to concede. This " higgling of the market " 
is as old as buying and selling. " In medio tutissimus ibis " 
is very often a safe rule in settling labor differences. But 
while this is true in very many cases, and as true where 
arbitration is not appealed to as when it is, I assert that 
the records of arbitration disprove the assertion that its 
results are usually " compromises." Even where an 
award between the demands of the parties is made, in 
but few instances is it " splitting the difference." The 
awards are, with rare exceptions, honest decisions based 
upon the facts and arguments presented. If it happens 
that they do " split the difference/' that is not chargeable 
to arbitration. 

Another objection to arbitration is that the awards are 
not accepted by one or both parties, or, as it is usually 
expressed, " are not lived up to." It is true that in some 
cases, much less frequently than is generally believed, the 
awards of umpires or the decisions of boards have been 
rejected after the parties have bound themselves by the 
most sacred of obligations, their honor, to abide by the 
result. But is there any method of settling labor differ- 
ences of which the same cannot be said ? Is the result of 
a strike or lockout any better *' lived up to " ? Would 
the parties who thus violate their pledged word of honor 
accept any decision, however reached, that did not accord 
with their views, or, in other words did not make them 
the judge and arbitrator ? The objection lies not against 
the system. It is against the individuals it deals with. 

But, granting that there are some instances of rejection 
of awards, is it not equally true that this is the only sys~ 



AND THEIR SETTLEMENT. 7$ 

tern that provides for and secures the settlement of these 
questions for a definite time ? When an agreement is 
reached or an award made and accepted, there is little 
doubt as to its being loyally observed. The wages of 
certain classes of skilled labor in the iron mills of Pitts- 
burgh have been regulated since 1865 by what are termed 
"conference committees," which are really temporary 
committees of conciliation. In these twenty-one years 
there is not a single instance of the violation of an agree- 
ment once reached. Even when, as in one case, there 
has been such a change in values as to lead the manu- 
facturs to suggest a change in the agreement favorable 
to the workmen, it was rejected by the employes on the 
ground that they would not consent to the least violation 
or change in the agreement, even in their own favor. 

A more serious objection to arbitration in the minds of 
many is, that it seems to necessitate the existence and 
recognition of trades-unions and employers' associations, 
both to provide for the election of members of the board 
and to furnish that power that shall compel the accept- 
ance of the awards. 

It is not necessary, though it will usually be found ad- 
visable, to have the members of the board representing 
labor elected by labor in some organized form. There is, 
then, a tangible body responsible for the selection. To 
it appeal can be had, and by it discipline can be admin- 
istered. An unorganized crowd is usually neither as de- 
liberate, as wise, nor as conservative in its actions as one 
that has put itself under the restraint of laws, precedents, 
and officers. 

But it is conceded that at present there seems to be no 
other authority possessed of the power, which at times is 
necessary to enforce obedience to awards, than that re- 
siding in unions. As has been pointed out, in all settle- 



j6 LABOR DIFFERENCES 

ments of labor differences by whatever method, the meas- 
ure of success is the consent of the parties. Experience 
has shown that that consent is capricious and the honor 
and pledged word of the parties at times of little value. 
This is as true in settlements reached without arbitration 
as of those the results of this method. The necessity of 
a power strong enough to compel the acceptance of set- 
tlements and so constituted that it can enforce its com- 
mands, is evident. The state, as the embodiment of law 
and power, has been suggested, but in these matters it is 
powerless. It is evident that as the measure of power is 
the consent of the governed, the power to enforce the 
awards must come from the parties themselves — that is, 
unions. It will be found that the success of arbitration 
has been greatest where there have been strong unions to 
compel the acceptance of the awards. 

It is not my purpose to discuss the advisability of un- 
ionism. From what has been said in previous chapters, 
it will be inferred that to the principle I give my hearty 
assent. I believe with the Duke of Argyle "that com- 
binations of working men for the protection of their labor 
are recommended alike by reason and experience." 
What I desire to ask those who object to arbitration on 
this account is if their objection will do away with union- 
ism, or if it will remove the necessity of recognizing and 
treating with unions in the near future. Unionism is 
here and it will not depart. It is growing yearly in 
power, in wisdom, and in organization. It cannot be 
crushed out ; it will not permit itself always to be ignored 
or despised. Is it wisest to treat it as an enemy or a 
friend ? Is it not best to make it, in the language of the 
Count of Paris, " a new element of productive power and 
an earnest pledge of peace." 

The most effective pledge of industrial peace, in view 



AND THEIR SETTLEMENT. JJ 

of the present constitution of industrial society and the 
conditions which obtain, is arbitration and conciliation, 
with strong unions to enforce its decisions. I speak of 
strong unions, for it is only a strong union that dare be 
just. A weak union which represents but a part of a 
section or trade is timid and cowardly and yet tyrannical, 
and seeks to make up in bluster and flagrant injustice 
what it lacks in power. But a strong union can be just 
and generous without fear of being charged with 
cowardice, and when there is beside it a strong employ- 
ers' association, strikes and lockouts will be of rare oc- 
currence, peace will be assured, and production go 
forward under the most promising conditions. 

The last objection to be noted is that arbitration is not 
a success ; that it does not settle labor differences nor 
prevent strikes and lockouts. That the labor or wages 
question is not settled is true. It never will be while the 
present relations of employer and employed continue. 
Arbitration never professed to settle it, but it is on the 
road to the place and time of settlement. Nor does ar- 
bitration profess to prevent strikes and lockouts unless 
the parties to them permit it to have the opportunity to 
do so — that is, unless it is called in to settle them. The 
question of the success or failure of arbitration has been 
clouded by a false issue. The true question is, has the 
system succeeded in those trades and those disputes in 
which it has been tried, not in those in which it has not 
been tried. Have these boards where they are in force 
solved the particular phases of the wages question pre- 
sented to them without strikes and lockouts ? As the re- 
sult of a most careful inquiry and investigation, I do not 
hesitate to answer, yes. Further, I am forced to accept 
the testimony of the very able and intelligent men who 
have been prominent advocates of arbitration, such men 



78 LABOR DIFFERENCES 

as Rt. Hon. A. J. Mundella, Sir Rupert Kettle, Thomas 
Hughes, Lord Derby, David Dale, and among the rep- 
resentatives of labor, Thomas Burt and Wm. Crawford, 
who represent the coal miners in Parliament ; the late 
John Kane and Edward Trow, of the Ironworkers' Union, 
Geo. Broadhurst and Geo. Howell, the present and past 
secretaries of the Trades-Unions Parliamentary Com- 
mittee. These and many others who have been connect- 
ed with these boards in one capacity or another, without 
exception, declare that in the way of settling trouble- 
some and difficult questions of wages without strikes and 
lockouts, boards of arbitration and conciliation have 
accomplished all their friends have claimed for them. 

The two trades in which arbitration and conciliation 
has been longest in use and has been used most sys- 
tematically and continuously, are the hosiery and glove 
trade at Nottingham, and the manufactured iron trade of 
the North of England. Previous to the establishment of 
boards of arbitration in these trades they were in con- 
stant ferment arising from labor troubles. Luddism had 
its christening if not its birth in the former, and there 
were three labor struggles in the latter in the year pre- 
vious to the formation of its board. In the hosiery and 
glove trade since i860, the year its board was formed, 
there has not been a general strike nor a single difference 
about wages that has not been settled amicably. As to 
the North of England iron trade, an article in the 
Colliery Guardian states that since the organization of its 
board in 1869, " there has been industrial peace in the 
district. Except in one isolated case, every decision of 
the umpires in the iron trades has been acquiesced in 
with unanimity." Now, here is the evidence of two 
trades in which it has been fairly tried, in one case for 
twenty-six years and in the other for fifteen years, — two 



AND THEIR SETTLEMENT. 79 

trades that in their character are very unlike. If the 
above statements are true, and they are susceptible of 
proof, it is a sufficient answer to the question of success. 
Though there may have been a thousand strikes in the 
Lancashire cotton trade, where it has not been in use, 
I fail to see what that has to do with the question of the. 
success of arbitration. Though there may have been 277 
strikes in other trades, the question at issue is, have there 
been any in the hosiery and glove trade at Nottingham, 
or in the manufactured iron trade of the North of Eng- 
land ? Has it saved 50,000 Durham miners and five 
times 50,000 dependent upon them from the horrors of 
industrial war ? Is not the fact that strikes and lockouts 
are frequent in other trades and not in these, an argu- 
ment for arbitration and conciliation rather than against 
it? 



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